1st Capital Bank Announces Second Quarter 2018 Financial Results; Record Quarterly Pre-Tax Earnings

SALINAS, CA / ACCESSWIRE / July 31, 2018 / 1st Capital Bank (OTC PINK: FISB) reported unaudited net income of $1.51 million for the three months ended June 30, 2018, compared to net income of $855 thousand for the three months ended June 30, 2017 and net income of $1.24 million for the three months ended March 31, 2018, the immediately preceding quarter. Earnings per share were $0.31 (diluted), compared to $0.26 (diluted) for the prior quarter.

“We are pleased with our continued earnings momentum and are happy to report that we achieved a couple of important milestones in our brief history this past quarter, achieving an 11% after-tax return on equity and, secondly, growing past $600 million in total assets,” said Thomas E. Meyer, President and Chief Executive Officer.

Unaudited net income for the six-month period ended June 30, 2018 increased 67.4% to $2.75 million, compared to $1.64 million for the six-month period ended June 30, 2017. Pre-tax income increased 42.2%, to $3.78 million for the six-month period ended June 30, 2018 from $2.66 million for the six-month period ended June 30, 2017. Quarterly net income increased $655 thousand, or 76.6%, year-over-year, compared to net income of $855 thousand recognized in the second quarter of 2017, and increased $272 thousand, or 21.9%, sequentially, compared to net income of $1.24 million recognized for the first quarter of 2018.

Net interest margin increased from 3.42% in the second quarter of 2017 and 3.70% in the first quarter of 2018 to 3.84% in the second quarter of 2018, as the Bank’s average net loans-to-deposits ratio increased from 81.1% in the second quarter of 2017 and 83.4% in the first quarter of 2018 to 86.2% in the second quarter of 2018 and average gross loans outstanding increased $48 million, or 11.7%, year-over-year, from $412 million to $460 million, and $19 million, or 4.3%, sequentially. Net interest income before provision for loan losses for the three-month period ended June 30, 2018 was $5.50 million, a sequential increase of $293 thousand, or 5.6%, compared to $5.21 million recognized in the three-month period ended March 31, 2018. The Bank’s cost of funds increased slightly, to 0.13% for the second quarter of 2018, compared to 0.13% for the second quarter of 2017 and 0.12% for the first quarter of 2018. On a year-over-year basis, quarterly net interest income before provision for loan losses increased $842 thousand, or 18.1%, from $4.66 million recognized in the second quarter of 2017.

“We are pleased to see the efforts of our team of outstanding bankers produce the strong results we are able to report today,” said Thomas E. Meyer, President, and Chief Executive Officer. “We remain committed to growing the core franchise of the Bank, that is, our expanding high-quality core loan portfolio and our low-cost core deposits portfolio. In the second quarter, more than 44 percent of our average deposits were demand deposits, and they will continue to create value as we experience higher interest rates than in the past.”

In the second quarter of 2018, loan growth was concentrated in the core portfolio, including commercial real estate loans, which organically grew $12 million, or 5.3%, from $236 million as of March 31, 2018 to $248 million as of June 30, 2018 and yielded 4.63%, 4.77%, and 4.82% in the second quarter of 2017 and the first and second quarters of 2018, respectively. Commercial and industrial loans grew $5 million, or 11.7%, from $40 million as of March 31, 2018 to $45 million as of June 30, 2018, and yielded 4.55%, 5.39% and 5.33% in the second quarter of 2017 and the first and second quarters of 2018, respectively. The single-family residential portfolio, which consists primarily of purchased loans, remained unchanged at $140 million as of March 31, 2018 and June 30, 2018. Loan purchases of $14 million in the second quarter of 2018 offset a similar amount of loan prepayments and principal amortization. The Bank’s single-family residential loan portfolio yielded 3.19%, 3.37%, and 3.33% in the second quarter of 2017 and the first and second quarters of 2018, respectively, as higher yielding loans originated in-house declined $7 million in the second quarter of 2018, offsetting the higher yields obtained on recently purchased loans in comparison to prior purchases. Overall, the loan portfolio increased $22 million, or 4.8%, sequentially from March 31, 2018 to June 30, 2018 and $55 million, or 13.2%, year over year, from $419 million as of June 30, 2017 to $474 million as of June 30, 2018. The yield on the loan portfolio increased from 4.25% in the second quarter of 2017 to 4.38% in the first quarter of 2018 and 4.44% in the second quarter of 2018.

“Our second quarter operating results make it clear that the Bank has benefitted from the current rising interest rate environment. At the same time, management has taken steps to place the Bank on a more neutral footing with respect to possible future interest rate fluctuations,” said Michael J. Winiarski, Chief Financial Officer. “We have been successful in controlling the cost of interest-bearing liabilities, but we are seeing increasing signs that the market is demanding higher interest rates on deposits, as well as becoming increasingly receptive to time deposits.”

Non-interest income for the six-month period ended June 30, 2018 increased 95.9% to $978 thousand, compared to $499 thousand for the six-month period ended June 30, 2017. Quarterly non-interest income increased $355 thousand, or 146.0%, year-over-year to $597 thousand, compared to non-interest income of $243 thousand recognized in the second quarter of 2017, and increased $217 thousand, or 56.9%, sequentially, compared to non-interest income of $381 thousand recognized for the first quarter of 2018.

Non-interest expenses for the six-month period ended June 30, 2018 increased 13.9% to $7.89 million, compared to $6.93 million for the six-month period ended June 30, 2017. Quarterly non-interest expenses increased $488 thousand, or 13.9%, year-over-year to $4.01 million, compared to non-interest expenses of $3.52 million recognized in the second quarter of 2017, and increased $126 thousand, or 3.3%, sequentially, compared to non-interest expenses of $3.88 million recognized for the first quarter of 2018.

NET INTEREST INCOME BEFORE PROVISION FOR CREDIT LOSSES

Net interest income before provision for credit losses was $ 5.50 million in the second quarter of 2018, an increase of $842 thousand, or 18.1%, compared to $4.66 million in the second quarter of 2017 and an increase of $293 thousand, or 5.6%, compared to $5.21 million in the first quarter of 2018.

Average earning assets were $575 million during the second quarter of 2018, an increase of 0.7% compared to $571 million in the first quarter of 2018 and an increase of 5.2% compared to $547 million in the second quarter of 2017. The yield on earning assets was 3.96% in the second quarter of 2018, compared to 3.54% in the second quarter of 2017 and 3.81% in the first quarter of 2018, primarily due to an increase in the average balance of gross loans outstanding from $412 million in the second quarter of 2017 and $441 million in the first quarter of 2018 to $460 million in the second quarter of 2018 and, secondly, to an increase in the yield on average loans outstanding, which was 4.25%, 4.38% and 4.44%, in the second quarter of 2017, the first quarter of 2018, and the second quarter of 2018, respectively. The average balance of the investment portfolio decreased from $74 million in both the second quarter of 2017 and the first quarter of 2018 to $70 million in the second quarter of 2018, as contemplated by the Bank’s business plan and reflecting normal amortization and prepayments on the Bank’s investments in mortgage-backed securities and collateralized mortgage obligations, offset by $4 million in investment purchases in the second quarter 2018. The yield on the investment portfolio increased from 1.45% in the second quarter of 2017 to 2.01% in the first quarter of 2018 and 2.18% in the second quarter of 2018. The average balances of other interest-earning assets (exclusive of Federal Home Loan Bank stock) declined from $58 million in the second quarter of 2017 to $53 million in the first quarter of 2018 and $41 million in the second quarter of 2018, while their yield was 0.95%, 1.34%, and 1.38% for the respective quarters.

The cost of interest-bearing liabilities increased from 0.23% in each of the second quarter of 2017 and the first quarter of 2018 to 0.24% in the second quarter of 2018, while the average balance of interest-bearing liabilities decreased from $288 million in the second quarter of 2017 to $284 million in the first quarter of 2018 and increased to $293 million in the second quarter of 2018. During the past twelve months, the Bank managed its leverage ratio, primarily with Promontory Interfinancial Network’s Insured Cash Sweep (“ICS”) program, which had off-balance sheet quarter-end balances of $48 million, $120 million, and $98 million as of June 30, 2017, March 31, 2018, and June 30, 2018. The balances reflect a significant liquidity event experienced by a Bank depositor in February 2018, as well as continued interest on the part of large depositors in the program. These funds may be moved back into the Bank’s deposit portfolio at the Bank’s discretion, and reciprocal deposits on the Bank’s balance sheet as of June 30, 2018 totaled $32 million. There were no reciprocal deposits on the Bank’s balance sheet as of June 30, 2017 or March 31, 2018. The average balance of noninterest-bearing demand deposit accounts (“DDAs”) increased from $220 million, or 43.3% of total deposits, in the second quarter of 2017 to $245 million, or 46.3% of total deposits, in the first quarter of 2018, and decreased to $242 million, or 45.3% of total deposits, in the second quarter of 2018, consistent with the normal seasonal pattern of the Bank’s deposits. The Bank’s overall cost of funds decreased from 0.13% in the second quarter of 2018 to 0.12% in the first quarter of 2018 and increased to 0.13% in the second quarter of 2018.

PROVISION FOR CREDIT LOSSES

The provision for credit losses is a charge against current earnings in an amount determined by management to be necessary to maintain the allowance for loan losses at a level sufficient to absorb management’s estimate of probable incurred credit losses inherent in the loan portfolio as of the balance sheet date in light of losses historically incurred by the Bank and adjusted for qualitative factors associated with the loan portfolio.

For the six-month period ended June 30, 2018, the Bank recorded a provision for loan losses of $20 thousand, compared to a provision of $25 thousand in the six-month period ended June 30, 2017. The Bank recorded provisions for loan losses of $25 thousand in the second quarter of 2017, $20 thousand in the first quarter of 2018, and no provision in the second quarter of 2018.

The changes in the provision reflect declines in the levels of problem assets, offset by the growth of the portfolio, changes in the mix of loan types within the portfolio and their respective loss histories, as well as management’s assessment of the amounts expected to be realized from certain loans identified as impaired. Impaired loans totaled $3.8 million as of June 30, 2018, compared to $5.4 million as of June 30, 2017, and $3.9 million as of March 31, 2018.

As of June 30, 2018, non-performing loans were 0.04% of the total loan portfolio, compared to 0.07% at June 30, 2017 and 0.06% at March 31, 2018. As of June 30, 2018, the allowance for loan losses was 1.35% of outstanding loans, compared to 1.49% as of June 30, 2017 and 1.42% at March 31, 2018, respectively. The Bank recorded net recoveries of $13 thousand in the second quarter of 2018, compared to net recoveries of $8 thousand and $12 thousand in the second quarter of 2017 and the first quarter of 2018, respectively.

NON-INTEREST INCOME

Year-to-date non-interest income increased $479 thousand, or 95.9%, from $499 thousand in the six-month period ended June 30, 2017 to $978 thousand in the six-month period ended June 30, 2018. Non-interest income recognized in the second quarter of 2018 was $597 thousand, including $65 thousand in gain on sale of Small Business Administration (“SBA”) guaranteed loans, compared to $243 thousand in the second quarter of 2017, which included $14 thousand in gain on sale of loans, and $381 thousand in the first quarter of 2018, which included gain on sale of loans of $70 thousand. This represents increases of $354 thousand, or 145.9%, compared to the second quarter of 2017, and an increase of $217 thousand, or 56.9%, compared to the first quarter of 2018.

Management has been actively seeking to increase non-interest income across a range of sources, including account analysis fees, lockbox service fees, and mortgage brokerage fees. On a year-to-date basis, the increase in non-interest income included a 30.0% increase in service charges on deposits, including lockbox and analysis fees, from $110 thousand to $143 thousand; a 57.1% increase in gain on sale of loans, from $86 thousand to $135 thousand; and a 207.4% increase in other income, from $193 thousand to $595 thousand, primarily attributable to greater mortgage brokerage activity and increased participation in the ICS program, for the six-month periods ended June 30, 2017 and 2018, respectively.

NON-INTEREST EXPENSES

Non-interest expenses increased $126 thousand, or 3.3%, to $4.01 million in the second quarter of 2018, compared to $3.88 million for the first quarter of 2018, and increased $488 thousand, or 13.9%, compared to $3.52 million recognized in the second quarter of 2017.

Salaries and benefits increased $382 thousand, or 17.3%, to $2.58 million for the second quarter of 2018, compared to $2.20 million for the second quarter of 2017, and increased $103 thousand, or 4.1%, compared to $2.48 million recognized in the first quarter of 2018. The increase reflects an 8% increase in headcount from 79 employees as of June 30, 2017 to 85 employees as of June 30, 2018, primarily for loan production, loan underwriting, and regulatory compliance personnel. The increase in headcount, together with annual salary increases effective April 1, 2018, drove a $242 thousand, or 14.9%, increase in base salaries from $1.63 million in the second quarter of 2017 to $1.87 million in the second quarter of 2018. Sequentially, base salaries increased $127 thousand, or 7.3%, from $1.74 million in the first quarter of 2018 to $1.87 million in the second quarter. Accruals for stock-based and cash incentive compensation for employees totaled $382 thousand in the second quarter of 2018, an increase of $158 thousand, or 69.9%, compared to $219 thousand in the second quarter of 2017 and an increase of $29 thousand, or 8.3%, compared to $353 thousand in the first quarter of 2018, reflecting the improving performance of the Bank.

The efficiency ratio (non-interest expenses divided by the sum of net interest income before provision for loan losses and non-interest income) was 65.7% for the second quarter of 2018, compared to 71.8% for the second quarter of 2017 and 69.4% for the first quarter of 2018. Annualized non-interest expenses as a percent of average total assets were 2.52%, 2.69%, and 2.72% for the second quarter of 2017, the first quarter of 2018, and the second quarter of 2018, respectively.

PROVISION FOR INCOME TAXES

The Bank’s effective book tax rate was 27.8% in the second quarter of 2018, compared to 37.0% for the second quarter of 2017 and 26.6% for the first quarter of 2018. The lower effective rates in the first two quarters of 2018 reflect the Tax Cuts and Jobs Act of 2017’s reduction in the Federal corporate income tax rate from 34% to 21%.

About 1st Capital Bank

The Bank’s primary target markets are commercial enterprises, professionals, real estate investors, family business entities, and residents along the Central Coast Region of California. The Bank provides a wide range of credit products, including loans under various government programs such as those provided through the U.S. Small Business Administration (“SBA”) and the U.S. Department of Agriculture (“USDA”). A full suite of deposit accounts is also furnished, complemented by robust cash management services. The Bank operates full-service branch offices in Monterey, Salinas, King City, and San Luis Obispo. The Bank’s corporate offices are located at 150 Main Street, Suite 150, Salinas, California 93901. The Bank’s website is www.1stCapital.bank. The main telephone number is 831.264.4000. The primary facsimile number is 831.264.4001.

Member FDIC / Equal Opportunity Lender / SBA Preferred Lender

Forward-Looking Statements

Certain of the statements contained herein that are not historical facts are “forward-looking statements” within the meaning of and subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may contain words or phrases including, but not limited, to: “believe,” “expect,” “anticipate,” “intend,” “estimate,” “target,” “plans,” “may increase,” “may fluctuate,” “may result in,” “are projected,” and variations of those words and similar expressions. All such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Factors that might cause such a difference include, among other matters, changes in interest rates; economic conditions including inflation and real estate values in California and the Bank’s market areas; governmental regulation and legislation; credit quality; competition affecting the Bank’s businesses generally; the risk of natural disasters and future catastrophic events including terrorist related incidents and other factors beyond the Bank’s control; and other factors. The Bank does not undertake, and specifically disclaims any obligation, to update or revise any forward-looking statements, whether to reflect new information, future events, or otherwise, except as required by law.

This news release is available at the www.1stCapital.bank internet site for no charge.

For further information, please contact:

Thomas E. Meyer

Michael J. Winiarski

President and Chief Executive Officer

Chief Financial Officer

831.264.4057 office

831.264.4014 office

Tom.Meyer@1stCapitalBank.com

Michael.Winiarski@1stCapitalBank.com

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except per share data)

June 30,

March 31,

December 31,

June 30,

Financial Condition Data1

2018

2017

Assets

Cash and due from banks

$
5,078

$
11,772

$
7,727

$
16,824

Funds held at the Federal Reserve Bank2

45,124

46,920

56,249

32,800

Time deposits at other financial institutions

996

1,743

747

Available-for-sale securities, at fair value

71,102

71,300

74,927

74,850

Loans receivable held for sale:

1,000

–

Loans receivable held for investment:

Construction / land (including farmland)

16,866

17,453

16,301

17,005

Residential 1 to 4 units

140,124

140,474

115,340

102,154

Home equity lines of credit

6,655

6,565

8,832

7,776

Multifamily

56,101

54,109

51,983

60,494

Owner occupied commercial real estate

64,048

64,009

67,326

67,169

Investor commercial real estate

128,289

117,896

105,196

102,854

Commercial and industrial

45,051

40,307

51,663

50,527

Other loans

16,956

11,685

11,292

10,848

Total loans

474,090

452,498

427,933

418,827

Allowance for loan losses

(6,423
)

(6,410
)

(6,378
)

(6,241
)

Net loans

467,667

446,088

421,555

412,586

Premises and equipment, net

2,239

2,315

2,308

2,343

Bank owned life insurance

7,759

7,706

7,654

7,543

Investment in FHLB3 stock, at cost

3,163

Accrued interest receivable and other assets

5,512

5,535

4,905

6,276

Total assets

$
609,640

$
596,795

$
580,231

$
557,132

Liabilities and shareholders’ equity

Deposits:

Noninterest bearing demand deposits

$
247,247

$
236,358

$
261,705

$
233,488

Interest bearing checking accounts

31,693

39,606

35,082

30,175

Money market deposits

144,069

125,147

107,101

116,739

Savings deposits

117,155

128,659

110,058

111,150

Time deposits

12,717

12,295

12,130

13,212

Total deposits

552,881

542,065

526,076

504,764

Accrued interest payable and other liabilities

2,093

1,839

2,163

2,087

Shareholders’ equity

54,666

52,891

51,992

50,281

Total liabilities and shareholders’ equity

$
609,640

$
596,795

$
580,231

$
557,132

Shares outstanding

4,706,003

4,697,873

4,686,521

4,428,930

Nominal and tangible book value per share

$
11.62

$
11.26

$
11.09

$
11.35

Ratio of net loans to total deposits

84.59
%

82.29
%

80.13
%

81.74
%

1 = Loans receivable held for investment are presented according to definitions applicable to the regulatory Call Report.
2 = Includes cash letters in the process of collection settled through the Federal Reserve Bank.
3 = Federal Home Loan Bank

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except per share data)

Three Months Ended

June 30,

March 31,

December 31,

June 30,

Operating Results Data

2018

2017

Interest and dividend income

Loans

$
5,093

$
4,769

$
4,365

Investment securities

382

367

313

266

Federal Home Loan Bank stock

Other

143

174

130

139

Total interest and dividend income

5,672

5,366

5,268

4,823

Interest expense

Interest bearing checking

Money market deposits

Savings deposits

Time deposits

Total interest expense on deposits

172

155

148

164

Interest expense on borrowings

–

Total interest expense

172

158

148

164

Net interest income

5,500

5,208

5,120

4,659

Provision for loan losses

–

Net interest income after provision

for loan losses

5,500

5,188

5,055

4,634

Noninterest income

Service charges on deposits

BOLI dividend income

Gain on sale of loans

Other

407

188

106

115

Total noninterest income

597

381

311

243

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except per share data)

Three Months Ended

June 30,

March 31,

December 31,

June 30,

2018

2017

Noninterest expenses

Salaries and benefits

2,583

2,481

2,194

2,202

Occupancy

288

290

282

263

Data and item processing

197

196

183

158

Professional services

132

138

168

194

Furniture and equipment

123

126

120

126

Provision for unfunded loan

commitments

–

(6
)

(4
)

Other

683

656

611

580

Total noninterest expenses

4,006

3,881

3,575

3,519

Income before provision for income taxes

2,091

1,688

1,791

1,358

Provision for income taxes

581

449

1,609

503

Net income

$
1,510

$
1,239

$
182

$
855

Common Share Data1

Earnings per common share

Basic

$
0.32

$
0.26

$
0.04

$
0.19

Diluted

$
0.31

$
0.26

$
0.04

$
0.19

Weighted average common shares outstanding

Basic

4,699,379

4,691,138

4,680,948

4,412,158

Diluted

4,795,170

4,776,021

4,763,936

4,476,055

1 = Earnings per common share and weighted average common shares outstanding have been restated to reflect the effect of the 5% stock dividend declared November 22, 2017 and paid December 15, 2017.

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except per share data)

Six Months Ended

June 30,

Operating Results Data

2018

2017

Interest and dividend income

Loans

$
9,862

$
8,552

Investment securities

749

512

Federal Home Loan Bank stock

110

123

Other

317

241

Total interest and dividend income

11,038

9,428

Interest expense

Interest bearing checking

Money market deposits

153

160

Savings deposits

144

132

Time deposits

Total interest expense in deposits

327

318

Interest expense on borrowings

–

Total interest expense

330

318

Net interest income

10,708

9,110

Provision for loan losses

Net interest income after provision for loan losses

10,688

9,085

Noninterest income

Service charges on deposits

143

110

BOLI dividend income

105

110

Gain on sale of loans

135

Other

595

193

Total noninterest income

978

499

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands, except per share data)

Six Months Ended

June 30,

2018

2017

Noninterest expenses

Salaries and benefits

5,064

4,393

Occupancy

578

492

Data and item processing

320

293

Professional services

270

318

Furniture and equipment

249

250

Provision for unfunded loan commitments

(6
)

Other

1,413

1,167

Total noninterest expenses

7,888

6,927

Income before provision for income taxes

3,778

2,657

Provision for income taxes

1,029

1,015

Net income

$
2,749

$
1,642

Common Share Data1

Earnings per common share

Basic

$
0.59

$
0.37

Diluted

$
0.58

$
0.37

Weighted average common shares outstanding

Basic

4,695,281

4,384,780

Diluted

4,775,233

4,452,035

1 = Earnings per common share and weighted average common shares outstanding have been restated to reflect the effect of the 5% stock dividend declared November 22, 2017 and paid December 15, 2017.

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)

June 30,

March 31,

December 31,

June 30,

Asset Quality

2018

2017

Loans past due 90 days or more and accruing

interest

$
–

Nonaccrual restructured loans

–

Other nonaccrual loans

198

252

255

301

Other real estate owned

–

$
198

$
252

$
255

$
301

Allowance for loan losses to total loans

1.35
%

1.42
%

1.49
%

Allowance for loan losses to nonperforming loans

3,243.94
%

2,543.65
%

2,501.18
%

2,073.42
%

Nonaccrual loans to total loans

0.04
%

0.06
%

0.07
%

Nonperforming assets to total assets

0.03
%

0.04
%

0.05
%

Regulatory Capital and Ratios

Common equity tier 1 capital

$
55,240

$
53,515

$
52,097

$
50,533

Tier 1 regulatory capital

$
55,240

$
53,515

$
52,097

$
50,533

Total regulatory capital

$
60,673

$
58,722

$
57,161

$
55,466

Tier 1 leverage ratio

9.35
%

9.14
%

9.03
%

Common equity tier 1 risk based capital ratio

12.74
%

12.88
%

12.91
%

12.85
%

Tier 1 risk based capital ratio

12.74
%

12.88
%

12.91
%

12.85
%

Total risk based capital ratio

14.00
%

14.14
%

14.16
%

14.11
%

Three Months Ended

June 30,

March 31,

December 31,

June 30,

Selected Financial Ratios1

2018

2017

Return on average total assets

1.03
%

0.86
%

0.13
%

0.61
%

Return on average shareholders’ equity

11.25
%

9.51
%

1.38
%

6.90
%

Net interest margin

3.84
%

3.70
%

3.68
%

3.42
%

Net interest income to average total assets

3.74
%

3.61
%

3.56
%

3.34
%

Efficiency ratio

65.70
%

69.44
%

65.83
%

71.79
%

1 = All Selected Financial Ratios are annualized other than the Efficiency Ratio.

Three Months Ended

June 30,

March 31,

December 31,

June 30,

Selected Average Balances

2018

2017

Gross loans

$
459,931

$
441,069

$
431,144

$
411,708

Investment securities

70,500

73,879

73,586

73,545

Federal Home Loan Bank stock

3,163

3,104

Other interest earning assets

41,454

52,773

44,568

58,353

Total interest earning assets

$
575,048

$
570,884

$
552,461

$
546,710

Total assets

$
590,041

$
585,047

$
569,812

$
559,182

Interest bearing checking accounts

$
34,207

$
35,668

$
36,702

$
33,949

Money market deposits

124,057

115,386

112,179

127,569

Savings deposits

120,962

120,323

109,936

113,346

Time deposits

12,763

12,543

12,368

13,190

Total interest bearing deposits

291,989

283,920

271,185

288,054

Noninterest bearing demand deposits

241,852

245,085

243,874

219,608

Total deposits

$
533,841

$
529,005

$
515,059

$
507,662

Borrowings

$
–

$
933

$
1

$
44

Shareholders’ equity

$
53,844

$
52,826

$
52,365

$
49,699

1ST CAPITAL BANK
CONDENSED FINANCIAL DATA
(Unaudited)
(Dollars in thousands)

Six Months Ended

June 30,

Selected Financial Ratios

2018

2017

Return on average total assets

0.94
%

0.60
%

Return on average shareholders’ equity

10.39
%

6.76
%

Net interest margin

3.77
%

3.39
%

Net interest income to average total assets

3.68
%

3.32
%

Efficiency ratio

67.50
%

72.08
%

1 = All Selected Financial Ratios are annualized other than the Efficiency Ratio.

Six Months Ended

June 30,

Selected Average Balances

2018

2017

Gross loans

$
450,552

$
406,087

Investment securities

72,180

74,794

Federal Home Loan Bank stock

3,163

3,022

Other interest earning assets

47,082

57,868

Total interest earning assets

$
572,977

$
541,771

Total assets

$
587,558

$
553,027

Interest bearing checking accounts

$
34,934

$
34,086

Money market deposits

119,746

124,675

Savings deposits

120,644

111,037

Time deposits

12,654

13,144

Total interest bearing deposits

287,978

282,942

Noninterest bearing demand deposits

243,460

219,707

Total deposits

$
531,437

$
502,649

Borrowings

$
464

$
22

Shareholders’ equity

$
53,337

$
48,983

SOURCE: 1st Capital Bank

ReleaseID: 507674

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