Clatsop Community Bank Reports Third Quarter 2018 Results

Seaside, OR – Clatsop Community Bank (OTC: CLAT), reported a net profit of $193,000 or $0.17 per diluted share, for the three months ended September 30, 2018, compared to net profit of $171,000, or $0.15 per diluted share, for the same period the year prior. For the nine months ended September 30, 2018, the Bank reported a net profit of $608,000, or $0.56 per diluted share, compared to net profit of $452,000, or $0.43 per diluted share for the same period in 2017.

“Management is pleased to report strong earnings growth, fueled by increased deposit and asset growth, compared to the same period last year,” said President and CEO Joe Schulte. “Additionally, several key milestones were reached during the third quarter, as the Bank grew assets to more than $100 million and paid the first dividend in the Bank’s history,” he added.

Year-to-Date 2018 Financial Highlights:

Return on Average Assets (ROAA):0.84%
Net Interest Margin (TE)(NIM): 3.92%
Efficiency Ratio: 71.54%

Assets

Total assets of $101.9 million as of September 30, 2018 increased $7.1 million, or 7.49%, compared to $94.8 million in assets a year ago.

Loans, net of unearned income, decreased $0.4 million to $59.5 million at September 30, 2018, or 0.67% compared to $59.9 million a year ago. The allowance for loan losses as of September 30, 2018 was $640,000, or 1.08% of gross loans, compared to the $641,000, or 1.07% of gross loans as of September 30, 2017. Year-to-date 2018, the Bank had no charge-offs or loan recoveries. For the same period the year prior, the Bank had no charge-offs and $5,000 in loan recoveries.

“Business loan growth has been muted by aggressive competition, especially for strong borrowers,” said Chief Credit Officer Cindy Trask. “Increases in interest rates have resulted in accelerated loan pay-offs and pay-downs as borrowers react to higher interest expenses on loan balances. The loan portfolio continues to perform very well desirable loan quality metrics, and compares favorably to the performance of our peers,” she added.

The Bank had no other real estate owned (OREO) as of September 30, 2018 or as of September 30, 2017. The Bank had no loans on non-accrual as of September 30, 2018, or as of September 30, 2017.

Deposits and Other Liabilities

Total deposits were $90.7 million as of September 30, 2018, which is an increase of $6.8 million, or 8.10%, compared to $83.9 million in total deposits as of September 30, 2017. Non-interest-bearing deposits increased by $3.7 million or 12.21%, while interest-bearing deposits increased by $3.0 million, or 5.59%, compared to September 30, 2017.

There were no borrowings outstanding as of September 30, 2018 or September 30, 2017.

Earnings

Net-interest income continued to grow year-over-year. At $923,000 for the three months ended September 30, 2018, net-interest income increased $53,000, or 6.09% over the $870,000 in net-interest income for the same period in 2017. For the nine months ended September 30, 2018, Net-interest income totaled $2.6 million, an increase of $164,000 or 6.61% compared to $2.5 million as of September 30, 2017. Net-interest margin (TE) at 4.11% for the three months ended September 30, 2018 was five percentage points lower than the 4.16% net-interest margin (TE) during the same period a year ago. For the nine months ended September 30, 2018, Net-interest margin (TE) totaled 3.92%, fifteen basis points lower than the net-interest margin (TE) of 4.07% a year ago.

Non-interest income, for the three months ended September 30, 2018, at $58,000, decreased $24,000 or 29.27% compared to $82,000 during the same period in 2017. For the nine months ended September 30, 2018, non-interest income totaled $207,000, a decrease of $31,000 or 13.03% compared to $238,000 as of September 30, 2017. Non-interest expense for the three months ended September 30, 2018, at $717,000, increased $41,000, or 6.07% over the $676,000 during the same period in 2017. For the nine months ended September 30, 2018, non-interest expenses totaled $2.04 million, an increase of $22,000, or 1.09% compared to $2.02 million as of September 30, 2017.

CFO Steve McCoy said, “The Bank’s capital ratios remain very strong, as both robust earnings and the exercise of over 38,000 stock options contributed to Tier One Capital levels.”

Equity and Capital

Stockholders’ equity, at $10.9 million as of September 30, 2018, increased $400,000, or 3.81% compared to September 30, 2017. The Bank remains categorized as well-capitalized under the regulatory framework for prompt corrective action. The Bank’s tier-one leverage ratio was 11.6% as of September 30, 2018, compared to 11.2% as of September 30, 2017, while its total risk-based capital ratio was 17.0% as of September 30, 2018, compared to 15.49% as of September 30, 2017. To be well-capitalized under prompt corrective action provisions, the Bank must maintain a tier-one leverage ratio of greater than 5.0%, and a total risk-based capital ratio of greater than 10.0%. The Common Equity Tier One ratio under Basel III (Standard Approach) as of September 30, 2018 was 16.07%, compared to 14.56% as of September 30, 2017.

“The Bank has performed well in a highly competitive environment, and possesses a strong capital position to support continued growth,” Schulte added.

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About Clatsop Community Bank:

Information about the Company’s stock may be obtained through the OTCQB marketplace at www.otcmarkets.com. Clatsop Community Bank’s stock symbol is CLAT. Clatsop Community Bank was formed in 2008 to serve Clatsop County and neighboring counties as the only locally-owned and operated bank in the area. The Bank has been named among the “100 Best Companies to Work for in Oregon” by Oregon Business Magazine for seven of its 10 years in operation. For more information about Clatsop Community Bank, visit our website at www.clatsopbank.com. Information contained in or linked to our website is not incorporated as a part of this release.

Certain statements in this release may constitute forward-looking statements within the definition of the “safe-harbor” provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to significant uncertainties, which could cause actual results to differ materially from those set forth in such statements. Forward-looking statements are those that incorporate management’s current expectations and plans based on information currently known to them. These statements can sometimes be identified by words such as “believe,” “estimate,” “anticipate,” “expect,” “intend,” “will,” “may,” “should,” or other similar phrases or words. Readers are cautioned not to place undue reliance on forward-looking statements. In particular, they should not be construed as assurances of a given level of performance or as promises of a given set of management’s actions. Some of the factors that could cause management to deviate from its current plans, or could cause the Company’s results to differ from current expectations, include the effect of localized or regional economic shifts that may affect the collectability of loans or the value of the collateral underlying those loans; the effects of laws, regulations, policies and government actions upon the Company’s assets and operations; sensitivity to the Northwestern Oregon geographic markets and events affecting those markets; and the impacts of new government initiatives upon us and our borrowers. The Company does not intend to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.