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1st Enterprise Bank Announces Net Income of
$1.39 Million for the 3rd Quarter of 2013

LOS ANGELES, CA--(Marketwired - Oct 18, 2013) - 1st Enterprise Bank ("the Bank") (OTC.BB:FENB), an independent full-service commercial bank serving the Southern California business community, reported net income of $1,388,000 for the quarter ending September 30, 2013.

Financial Highlights

  • Total Assets grew by 11%, from $662 million at September 30, 2012 to $731 million at September 30, 2013
  • Total Loans outstanding grew by $83 million or 22%, from $381 million at September 30, 2012 to $464 million at September 30, 2013
  • Total Deposits grew by 6%, from $592 million at September 30, 2012 to $629 million at September 30, 2013
  • Net interest income of $5.5 million was the highest in the Bank's history and 14% higher than the third quarter of 2012
  • Net Income applicable to common shareholders was $1,347,000 for the third quarter of 2013, compared to $608,000 for the third quarter of 2012
  • Income before taxes, loan loss provision and gain on sale of securities was $2,119,000 for the quarter, a 29% increase over the prior year
  • Diluted earnings per common share was $.33 for the quarter, compared to $.15 in the third quarter of 2012

"Our third quarter earnings reflect a significant improvement over last year, and our continuing momentum in terms of both growth and return," said John Black, CEO. "We are very pleased that the Bank's return on common equity exceeded 10% for the second consecutive quarter."

For the three months ended September 30, 2013, net interest income before provision was $5.5 million, an increase of 14% compared to the third quarter of 2012 and an increase of 1% compared to the second quarter of 2013. The year-over-year growth in net interest income was the result of both earning asset and net interest margin growth. Earning assets were $672 million in the third quarter of 2013, an 8% or $51 million increase over the prior year. The net interest margin was 3.23% during the third quarter of 2013, compared to 3.08% for the prior year. This increase resulted from the yield on earning assets increasing from the prior quarter as loan balances grew from 57% of earning assets, to 67%. The 1% increase over the second quarter of 2013 was due to growth in earning assets of $16 million that was offset by a decline in the net interest margin from 3.32% to 3.23%. The decrease in net interest margin was the result of declining loan and investment yields due to the continuation of the current low rate environment. The provision for loan loss was $4,000 for the third quarter of 2013, a $741,000 decrease year over year and a $62,000 sequential decrease. The Bank had net recoveries of $11,000 in the third quarter and $21,000 during the second quarter of 2013. As of September 30, 2013 there were no non-accrual loans.

Non-interest income, excluding gain on sale, was $904,000 for the quarter, which was a $23,000 decrease year over year and a $27,000 sequential increase.

Non-interest expense increased over the prior year and prior quarter by $174,000 and $131,000, respectively. Growth in non-interest expense was generally due to staff additions during the third quarter.

"We are very proud of these results and improving metrics, which are the result of the efforts of our very talented staff," said Brian Horton, President. "We thank our shareholders and customers for their continued support of our vision of being the recognized leader in the field of business banking."

About 1st Enterprise Bank

Founded in 2006, 1st Enterprise Bank is a full service independent commercial banking institution, whose highly experienced bankers personally serve Southern California entrepreneurial businesses, professional firms and nonprofit organizations, along with their owners and key managers. Headquartered in the Los Angeles financial district, with full service regional banking offices in Irvine and Ontario and an LPO in Woodland Hills, 1st Enterprise Bank offers a full range of credit and depository services, with special emphasis on superior customer service, sophisticated cash management services and direct access to bank decision makers. Customers work directly with a dedicated Relationship Manager, a seasoned professional who understands their unique challenges serving as a sounding board and an active participant in their client's success.

Forward-Looking Statement:

This news release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about 1st Enterprise Bank's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: 1st Enterprise Bank's timely implementation of new products and services, technological changes, changes in consumer spending and savings habits and other risks discussed from time to time in 1st Enterprise Bank's reports and filings with banking regulatory agencies. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and 1st Enterprise Bank does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

1st Enterprise Bank
Condensed Statements of Financial Condition

 
unaudited
Assets
9/30/2013
 
6/30/2013
 
9/30/2012
      Cash and due from banks
$ 25,030
 
$ 16,786
 
$ 21,058
      Interest earning deposits in other banks
11,708
 
12,036
 
15,357
            Total cash and cash equivalents


36,738   28,822   36,415
      Certificates of deposit in other banks 2,241   2,490   498
      Investment securities - available-for-sale 144,462   154,689   167,518
      Investment securities - held-to-maturity 61,274   61,931   56,114
      Loans, net of deferred loan fees 463,998   444,861   381,307
      Allowance for loan losses
(5,805)
 
(5,790)
 
(5,595)
      Loans, net of allowance for loan losses 458,193   439,071   375,712
      Bank owned life insurance 16,281   16,148   13,276
      Premises and equipment, net 2,536   2,647   2,274
      Accrued interest receivable and other assets
9,612
 
10,313
 
10,022
            Total Assets


$ 731,337
 
$ 716,111
 
$ 661,829
Liabilities          
      Non-interest-bearing demand deposits
$ 298,662
 
$ 274,167
 
$ 273,197
      Interest bearing transaction accounts 36,841   38,076   43,884
      Money market and savings accounts 282,465   271,377   264,056
      Time deposits
11,524
 
16,879
 
10,739
            Total Deposits 629,492   600,499   591,876
      Federal Home Loan Bank Borrowings 30,000   45,000   -
      Other liabilities
3,501
 
3,384
 
4,913
            Total Liabilities


662,993   648,883   596,789
Shareholders' Equity          
      Serial Preferred Stock 16,380   16,380   16,380
      Common Stock 43,109   43,068   43,008
      Retained Earnings 8,634   7,287   3,752
      Accumulated other comprehensive income
221
 
494
 
1,900
            Total Shareholders' Equity
68,344
 
67,228
 
65,040
Total Liabilities and Shareholders' Equity
$ 731,337
 
$ 716,111
 
$ 661,829

1st Enterprise Bank
Condensed Statements of Operations

 
Three Months Ended
 
unaudited
Interest Income
9/30/2013
 
6/30/2013
 
9/30/2012
      Interest and fees on loans
$ 4,780
 
$ 4,724
 
$ 3,957
      Interest on investment securities 855   879   986
      Other interest income
11
 
7
 
36
            Total interest income 5,646   5,610   4,979
Interest Expense
180
 
183
 
179
Net Interest Income 5,466   5,427   4,800
Provision for loan losses
4
 
66
 
745
Net Interest Income After Provision for Loan Losses

5,462   5,361   4,055
Non-interest Income          
Service charges, fees and other income 904   877   927
Gain on sale of investment sercurities
(12)
 
4
 
18
            Total non-interest Income


892   881   945
Non-interest Expenses          
      Compensation and benefit expenses 2,584   2,450   2,342
      Occupancy and equipment expenses 399   405   359
      Data processing 268   268   278
      Professional and legal 347   334   417
      Other operating expenses
654
 
664
 
682
            Total non-interest expense


4,252   4,121   4,078
Income Before Income Taxes
2,103
 
2,122
 
922
Provision for income taxes
715
 
712
 
273
Net Income
$ 1,388
 
$ 1,410
 
$ 649
Preferred dividends & Warrant amortization
41
 
41
 
41
Net Income Applicable to Common Shareholders


$ 1,347
 
$ 1,369
 
$ 608
Earnings Per Share          
Basic earnings per share
$ 0.36
 
$ 0.36
 
$ 0.16
Diluted earnings per share
$ 0.33
 
$ 0.34
 
$ 0.15
Average shares outstanding 3,795,218   3,793,339   3,790,359
Average fully diluted shares 4,123,964   4,082,229   4,002,939
Total Shares outstanding at end of period


3,822,389   3,815,589   3,814,539
Capital Ratios          
Tier 1 leverage ratio 9.6 %   9.6 %   9.6 %
Tier 1 risk-based capital ratio 11.5 %   11.8 %   12.1 %
Total risk-based capital ratio 12.5 %   12.9 %   13.3 %
Book value per share

$ 13.59
 
$ 13.33
 
$ 12.76
Performance Ratios          
Return on average assets 0.77 %   0.81 %   0.39 %
Return on average common equity 10.37 %   10.51 %   4.97 %
Net interest margin 3.23 %   3.32 %   3.08 %
Cost of Funds 0.11 %   0.12 %   0.12 %
Efficiency ratio

66.3 %   66.0 %   72.4 %
Average Balances          
Total Assets
$ 713,333
 
$ 699,387
 
$ 660,792
Earning Assets 671,798   655,884   620,656
Total Loans 448,250   435,824   356,425
Total Securities 213,618   215,564   210,271
Total Deposits 623,879   603,104   591,691
Common Equity 51,540   52,230   48,692

Contact:
John C. Black
CEO
213-430-7070

 

Copyright 2012, 1st Enterprise Bank, Inc. All rights reserved.