Friendly Hills Bank Reports Third Quarter Results; Announces Jeffrey Ball Will Serve on ABA Board of Directors


WHITTIER, Calif., Nov. 16, 2016 (GLOBE NEWSWIRE) -- Friendly Hills Bank (the “bank”) (OTCBB:FHLB) reported results for the third quarter of 2016.

For the nine month period ending September 30, 2016, the bank reported net income of $328,000 or $0.17 per diluted share of common stock.  This figure includes a $36,000 net gain on securities sold.  The bank reported net income of $297,000 or $0.15 per diluted share of common stock for the nine months ended September 30, 2015.  This figure includes a $22,000 increase in the value of the interest rate caps, a $31,000 net gain on securities sold, and a $43,000 gain on other real estate owned. 

As of September 30, 2016, the bank reported total assets of $142.6 million, a 10% increase from $129.6 million as of September 30, 2015.  The bank’s loan portfolio, net of unearned income, increased 15% from $68.8 million as of September 30, 2015, to $79.0 million as of September 30, 2016.  The portfolio remains diversified with $30.8 million or 39% in Commercial & Industrial Loans to local businesses (including $20.0 million in Owner Occupied Commercial Real Estate Loans), $22.1 million or 28% in Commercial Real Estate Loans to investors and $18.5 million or 23% in Residential Real Estate Loans to investors.  The bank has an additional $22.7 million in unfunded loan commitments.

The bank’s overall deposit base has increased 17% in the twelve months ended September 30, 2016, from $98.6 million as of September 30, 2015, to $115.1 million as of September 30, 2016.  Non-interest bearing deposits continue to form a substantial part of the deposit base (42%), growing from $44.1 million to $48.1 million as of September 30, 2016.  During the same time period interest-bearing deposits increased from $54.5 million to $67.0 million on September 30, 2016.   The bank has no deposits which were sourced through brokers or other wholesale funding sources.

At September 30, 2016, shareholders’ equity was $15.9 million and the bank’s total risk-based capital ratio was 17%, significantly exceeding the “well-capitalized” level of 10% prescribed under regulatory requirements. The bank also continues to maintain substantial liquidity positions, retaining significant balances of liquidity as well as available collateralized borrowings and other potential sources of liquidity.

“The bank continues to experience strong growth in all facets of our business while maintaining a strong balance sheet,” commented Jeffrey K. Ball, Chief Executive Officer.  “We are particularly pleased to report significant growth in the bank’s loan portfolio which we have been able to achieve while maintaining our rigorous underwriting standards.  Those standards are essential in recognizing the continued uncertainty of market conditions including the sustainability of a low interest rate environment.  Meanwhile our deposit base continues to grow providing core funding for our lending platform while we are encouraged by the progress in our Payroll Processing business.  That business line is designed to enhance fee income through what we anticipate will be a sustained period of contracting loan yields as the market continues to see growth in non-bank lenders.”

The bank is also proud to announce that Jeffrey K. Ball, Chief Executive Officer, was recently elected to serve on the Board of Directors of the American Bankers Association in Washington, D.C.  Mr. Ball currently serves as Vice Chairman of the national association’s Government Relations Council and previously served as Chairman of the California Bankers Association.

Company Profile:
Friendly Hills Bank is a community bank which was formed to primarily serve the Southern California communities of eastern Los Angeles County and northern Orange County.  The bank was established in 2006 by prominent members of the local community who were seeking an alternative to the larger financial institutions in the area.  The bank is headquartered in Whittier, California with an additional branch office in Santa Fe Springs, California.  For more information on the bank, please visit www.friendlyhillsbank.com or call 562-947-1920.

Forward Looking Statements:
The numbers in this press release are unaudited. Statements such as those regarding the anticipated development and expansion of Friendly Hills Bank's business, and the intent, belief or current expectations of the bank, its directors or its officers, are "forward looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward looking statements. These risks and uncertainties include, but are not limited to, risks related to the local and national economy, the bank's performance, including its ability to generate loan and deposit growth, changes in interest rates, and regulatory matters.

Friendly Hills Bank
Balance Sheets (Unaudited)
(in thousands, except per share information)
   9/30/16 12/31/15 9/30/15
ASSETS      
Cash and due from banks$ 4,026  $  3,904  $ 5,363 
Interest bearing deposits with other financial institutions 22,993   4,529   4,156 
  Cash and Cash Equivalents 27,019   8,433   9,519 
Investment securities available-for-sale 30,624   43,312   45,252 
Federal Home Loan Bank stock 779   753   753 
Federal Reserve Bank stock 457   455   455 
Loans, net of unearned income 79,019   67,876   68,841 
Allowance for loan losses (1,525)  (1,595)  (1,595)
  Net Loans 77,494   66,281   67,246 
Premises and equipment, net 229   211   248 
Accrued interest receivable and other assets 6,017   6,134   6,149 
  Total Assets$  142,619  $125,579  $129,622 
        
LIABILITIES AND SHAREHOLDERS’ EQUITY     
Liabilities      
Deposits      
 Noninterest-bearing deposits$ 48,055  $  42,531  $ 44,103 
 Interest-bearing deposits 67,047   54,354   54,541 
  Total Deposits 115,102   96,885   98,644 
FHLB advances 11,000   13,000   15,000 
Accrued interest payable and other liabilities 657   452   580 
  Total Liabilities 126,759    110,337    114,224 
Shareholders’ Equity     
 Common stock, no par value, 10,000,000 shares authorized:     
    1,939,193 shares issued and outstanding 15,958   15,958   15,958 
 Additional paid-in-capital 1,091   1,091   1,091 
 Accumulated deficit (1,323)  (1,651)  (1,748)
 Accumulated other comprehensive income (loss) 134   (156)  97 
  Total Shareholders’ Equity 15,860   15,242   15,398 
  Total Liabilities and Shareholders’ Equity$  142,619  $125,579  $129,622 
        
Book Per Share$   8.18  $ 7.86  $   7.94 


Friendly Hills Bank
Statements of Operations (Unaudited)
 (in thousands, except per share information)
       
    For the nine For the nine
    months ended months ended
    9/30/16 9/30/15
Interest Income
 $  3,360  $  3,260 
Interest Expense
  (234)  231 
  Net Interest Income
  3,126   3,029 
Provision for Loan Losses
  0   0 
  Net Interest Income after Provision for Loan Losses
    3,126   3,029 
   
        
Noninterest Income
  335   338 
Noninterest Expense
  (2,976)  (2,997)
Non-Recurring Items
  36   96 
Income before Provision for Income Taxes
  521   466 
(Provision) Benefit for Income Taxes
  (193)  (169)
  Net Income
 $  328  $     297 
       
Basic and Diluted Earnings Per Share
 $ 0.17  $     0.15 

 


            

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