NEW YORK, NY / ACCESSWIRE / August 20, 2018 / First American International Corp. (OTCQB: FAIT) (www.faib.com) (the ''Company''), the holding company for First American International Bank (the ''Bank''), today reported net income available to shareholders for the quarter ended June 30, 2018 of $0.4 million and $3.2 million for the first half of 2018. Earnings per share available to common shareholders were $0.18 per share for the second quarter, both basic and fully diluted, and $1.45 per share, basic and $1.43 per share, fully diluted, for the first half of 2018.
Net Income and Results of Operations
The Company today reported net income available to common shareholders for the quarter ended June 30, 2018 of $0.4 million, or $0.18 per share, and $3.2 million, or $1.45 per share, for the first half of 2018. The income available to common shareholders is after deduction of $211,000 of Troubled Asset Relief Program (''TARP'') costs, consisting of preferred stock dividends of $85,000 and discount accretion of $126,000 for the current quarter and $420,000 in TARP costs, consisting of preferred stock dividends ($170,000) and discount accretion ($250,000) for the first half of 2018. This compares to net income of $1.7 million, or $0.79 per share, basic and diluted, for the quarter ended June 30, 2017, and net income of $3.1 million, or $1.42 per share, basic and diluted, for the first half of 2017, also after deduction of TARP dividends and discount accretion.
The Company also reported a return on average assets of 0.18% for the quarter ended June 30, 2018, compared to 0.80% for the same period in 2017 and a return on average common equity of 2.38% for the quarter ended June 30, 2018, compared to 11.64% for the same period in 2017.
The decrease in reported quarterly earnings versus the same period in 2017 is due primarily to a year-over-year 14.9% increase in non-interest expenses of $1.1 million, combined with a 37.5% decrease in non-interest income of $1.3 million, partially offset by a 5.9% increase in net interest income of $385,000 and a reduction in our effective tax rate as a result of the federal tax reform law enacted at the end of 2017. The current quarter and the first six months of 2018 included $1.3 million and $2.2 million, respectively, of expenses pertaining to the previously announced pending merger with RBB Bancorp (''RBB''), a California financial holding company, which RBB and the Company jointly announced on April 23, 2018. A decline in gains on loans sold was the principal cause of the decrease in non-interest income. Higher market interest rates in the current quarter resulted in unfavorable pricing of projected loan sales in the secondary market which led to a strategic decision to defer the sale of loans to third parties in the second quarter of 2018, compared to the sale of $49.4 million of loans to third parties in the same quarter of 2017.
The increase in earnings for the six months ended June 30, 2018 over the same period in 2017 is principally due to a 7.2% year-over-year increase in net interest income of $1.0 million, a 15.3% increase in non-interest income of $0.8 million, and a lower effective tax rate, partially offset by a year-over-year increase in non-interest expenses of $2.4 million, or 18.4%. The increase in net interest income was principally driven by an increase in yields due to higher market interest rates combined with an increase in the volume of interest-earning assets. The increase in non-interest income was primarily due to higher volume-driven loan servicing fees, a volume- and rate-driven improvement in the value of the Bank's mortgage servicing rights and the receipt of a Bank Enterprise Award (''BEA'') in the current quarter, partially offset by lower gains on sales of loans in the secondary market. The increase in non-interest expense was primarily due to the merger-related expenses.
Through the first half of 2018, the Company continued to successfully execute on its strategy of generating organic growth in the loan portfolio funded by an increase in retail deposits and generating residential loans for sale on a servicing retained basis. In accordance with management's strategy, loans receivable increased by $16.7 million, or 2.4%, to $709.9 million at June 30, 2018 compared to $693.2 million at March 31, 2018 due to a $29.0 million increase in the residential mortgage loan portfolio, partially offset by a $12.3 million decrease in the commercial real estate (''CRE'') portfolio. The decrease in the CRE portfolio is primarily due to one participation loan for $9.5 million paying off at maturity and the prepayment of four other CRE loans totaling $1.9 million during the second quarter of 2018.
''I continue to be pleased with our progress in growing our residential loan portfolio contributing to higher net interest income. The Bank will continue to focus on generating high quality loans, growing core deposits, controlling expenses and working towards the successful completion of our merger with RBB.'' said Mark Ricca, President and Chief Executive Officer.
Net Interest Income
Net interest income for the three months ended June 30, 2018, before provision for loan losses, was $6.9 million, an increase of $385,000, or 5.9%, from the prior year.
The increase in net interest income is primarily due to an increase in average yields on interest-earning assets driven principally by favorable market interest rate conditions. Our average yield on interest-earning assets increased by 18 basis points, from 4.03% in the second quarter of 2017 to 4.21% in the comparable period of 2018. An increase in average interest-earning assets, coupled with a decrease in average interest-bearing liabilities also contributed to the increase in net interest income. Average interest-earning assets increased by $22.4 million, or 2.6%, from $847.1 million in 2017 to $869.5 million in 2018. The increase in average interest-earning assets was largely due to growth in residential mortgage loans and overnight investments, $20.8 million and $38.5 million, respectively, partially offset by a decrease in average commercial real estate loans of $22.2 million.
The decrease in interest-bearing liabilities was coupled with an increase in noninterest-bearing demand deposits. This shift in liability mix enabled us to fund a higher percentage of interest-earning assets with no-cost deposits. Interest-bearing liabilities funded 72.6% of interest-earning assets in the second quarter of 2018 as compared to 75.6% in the comparable period of 2017. Net interest income was also positively impacted by improved loan pricing and rising yields on the Company's overnight investments during the recent quarter which resulted in a 10 basis point increase in net interest margin, from 3.09% for the three months ended June 30, 2017 to 3.19% for the comparable period in 2018.
Interest income increased by $0.7 million, or 7.3%, to $9.2 million in the second quarter of 2018 from $8.5 million in the comparable period of 2017. The increase in interest income is due to a year-over-year increase of 18 basis points in the yield on average earning assets, from 4.03% in the second quarter of 2017 to 4.21% in the second quarter of 2018, partially offset by a $3.5 million, or 0.5%, decrease in average loans outstanding. Average residential loans outstanding increased $20.8 million, or 5.0%, while average commercial real estate loans outstanding decreased $22.2 million, or 8.2%, when compared to the prior year comparable quarter. However, the overall yield earned on loans increased 22 basis points to 4.73% for the second quarter of 2018 from 4.51% in the comparable period of 2017. The increase was due principally to the rising rate environment during the last two quarters, which drove better loan pricing, resulting in the Bank originating new loans at higher rates than the existing portfolio.
The average volume of securities decreased by $12.6 million, or 20.3%, from $62.4 million in the second quarter of 2017 to $49.7 million in the second quarter of 2018, due to scheduled amortization and maturities during the past four quarters combined with the sale of securities with a book value of $1.8 million in the fourth quarter of 2017. The average yield on securities increased by 46 basis points, from 2.59% to 3.05%, principally as a result of management continuing its strategy of allowing lower yielding securities to mature while retaining more intermediate term securities with higher yields. The net effect of the decrease in volume and the increase in yield was a $25,000 decrease in interest and dividends earned on securities to $379,000 during the second quarter of 2018 compared to $404,000 in the prior year quarter.
Interest expense increased by $237,000, or 12.0%, during the second quarter of 2018 compared to the same quarter of 2017. The average cost of deposits increased 21 basis points to 1.24% in the second quarter of 2017 compared to 1.03% in the prior year comparable quarter. This was largely due to increases in both the volume and cost of certificates of deposit and money market deposit accounts, resulting from greater competition in the Company's key local markets and the overall increase in interest rates during the last two quarters. The average balance of certificates of deposit, our highest cost deposit category, increased by $2.4 million, or 0.7%, from $314.8 million in the second quarter of 2017 to $317.1 million in 2018. The average rate paid on certificates of deposit increased by 26 basis points from 1.30% in 2017 to 1.56% in 2018. The average balance of money market deposit accounts and savings accounts increased by $0.5 million, or 0.3%, from $158.8 million in 2017 to $159.3 million in 2018, with the average rate paid increasing from 0.51% to 0.63%, respectively.
Provision for Loan Losses
The Company recorded no provision for loan losses in the second quarter of 2018 or in the prior year quarter. Management believes the existing $9.6 million allowance at June 30, 2018 is appropriate. The allowance as a percentage of loans was 1.34% at June 30, 2018 compared to 1.35% at June 30, 2017. The reduction in the allowance as a percentage of total loans was due primarily to continued improvement in our historical loan loss experience, which is based upon the last twelve quarters of loan losses, a reduction in certain qualitative factors associated with a more robust risk management program and the improved economy, and a strategic decision by management to shift the portfolio mix more towards lower risk residential loans. We remain focused on maintaining our asset quality.
Non-interest Income
Non-interest income was $2.2 million for the quarter ended June 30, 2018, a decrease of $1.3 million, or 37.5%, compared to the quarter ended June 30, 2017. The decrease is largely due to a $1.8 million decrease in gains on sales of loans to third parties, as the Bank did not sell any loans to third parties in the second quarter of 2018 due to unfavorable pricing dynamics resulting from the sharp rise in interest rates during the second quarter compared to the sale of $49.4 million of loans to third parties in the second quarter of 2017, partially offset by a $176,000 volume-driven increase in loan servicing fees, a $227,000 volume- and rate-driven improvement year-over-year in the value of the Bank's mortgage servicing rights and a $233,000 increase in fee income associated with receiving a Bank Enterprise Award (''BEA'') in the current quarter. The BEA is a U.S. Government-sponsored program to support lending activities for Community Development Financial Institutions, which includes the Bank. In the second quarter of 2018, the federal government granted the Bank its award for the current year, while in the prior year, the Bank received a BEA award in the fourth quarter.
The Company recorded a $0.4 million pre-tax gain on the value of Mortgage Servicing Rights (''MSR'') in the second quarter of 2018, compared to a $0.2 million pre-tax gain in the second quarter of 2017. The increase was due principally to the combined effect of greater increases in market interest rates and an increase in the Bank's loan servicing portfolio in the second quarter of 2018 compared to the comparable quarter in 2017. Interest rates rose during the second quarter of 2018 compared to a decline in interest rates during the corresponding period in 2017, which resulted in a $493,000 increase in the value of the loan servicing portfolio during the second quarter of 2018 compared to a $100,000 decrease in value during the second quarter of 2017. This interest rate-driven net increase in value was partially offset by a $63.3 million decrease in the net change in the volume of loans serviced for others in the second quarter of 2018 compared to the corresponding period in 2017, as there were no loan sales to third parties with servicing retained in the second quarter of 2018 compared to $49.4 million of sales to third parties with servicing retained in the second quarter of 2017, which resulted in a $366,000 decrease in the value of servicing rights quarter-over-quarter. The value of MSR's is the market value of the right to earn fees for servicing loans. Since loan prepayments tend to vary with changes in interest rates, an increase or decrease in interest rates generally results in an increase or decrease, respectively, in MSR value. MSR values are also impacted by servicing portfolio volumes and general market driven supply and demand conditions.
Non-interest Expenses
Non-interest expenses were $8.1 million for the quarter ended June 30, 2018 compared to $7.1 million in 2017, an increase of $1.0 million, or 14.9%. The increase is primarily due to $1.3 million of merger-related expenses pertaining to the Company's pending merger with RBB, $101,000 for selective additions to staff to support loan portfolio growth and loan sales capabilities, $99,000 for higher occupancy costs, and $130,000 for higher volume-driven data processing, loan-related and marketing costs. These increases were partially offset by a $496,000 decrease in non-merger-related professional fees due to lower consulting fees and a $79,000 decrease in FDIC insurance premiums, due to a lower FDIC premium assessment rate.
Balance Sheet Highlights
Assets
Total assets at June 30, 2018 were $879.5 million, an increase of $5.6 million, or 0.6%, compared to June 30, 2017 and an increase of $6.5 million, or 0.7%, compared to December 31, 2017. Total loans receivable were $709.9 million, an increase of $17.0 million, or 2.5%, compared to June 30, 2017 and a decrease of $4.3 million, or 0.6%, compared to December 31, 2017. The increase compared to June 30, 2017, is due primarily to a $166.8 million, or 39.1%, increase in 5/1 and 7/1 adjustable rate 1-4 family mortgage loans, at an average yield of 4.71%, partially offset by $129.0 million of residential loan sales to third parties, and a $19.5 million, or 7.3%, decrease in commercial mortgage loans outstanding, largely due to eight commercial real estate loans with an aggregate principal balance of $19.7 million which were repaid either at or prior to maturity during the last twelve months.
Overnight investments at June 30, 2018 were $92.8 million, a decrease of $4.6 million, or 4.7%, compared to June 30, 2017 and an increase of $6.9 million, or 8.0%, compared to December 31, 2017. The average yield on overnight investments for the second quarter of 2018 was 1.63% compared to 1.54% in the second quarter of 2017. Investment securities at June 30, 2018 were $41.8 million, a decrease of $10.9 million compared to June 30, 2017 and a decrease of $2.1 million, or 4.7%, compared to December 31, 2017. The average yield on investment securities for the second quarter of 2018 was 3.05%. The decrease in investment securities was due to the continuation of management's strategy of allowing lower-yielding securities to mature while retaining more intermediate term securities with higher yields. The decrease in overnight investments, compared to the comparable period of 2017,was principally driven by growth in the loan portfolio during the second quarter of 2018. The Bank anticipates redeploying a portion of its overnight investments into new loan originations during the third quarter of 2018.
Asset Quality
Non-performing loans decreased by $1.4 million at June 30, 2018 to $2.2 million, or 0.31% of the loan portfolio, compared to $3.6 million, or 0.51% of the portfolio one year earlier, and compared to 0.38% of the portfolio at December 31, 2017. Non-performing loans were 0.25% of total assets at June 30, 2018, compared to 0.41% at June 30, 2017 and compared to 0.31% at December 31, 2017. Total delinquent loans decreased by $53,000 to $1.44 million at June 30, 2018, or 0.20% of the loan portfolio, compared to $1.49 million, or 0.21% of the portfolio, at June 30, 2017, and compared to $1.62 million, or 0.23% of the portfolio, at December 31, 2017. The Company monitors delinquent loans closely and continues to work on improving asset quality on an overall basis. The allowance for loan losses was $9.6 million, or 1.34% of total loans at June 30, 2018, compared to $9.3 million, or 1.35%, at June 30, 2017 and $9.5 million, or 1.33%, at December 31, 2017.
Deposits
Deposits increased by $10.0 million, or 1.6%, from $628.7 million at June 30, 2017 to $638.7 million at June 30, 2018 and by $8.9 million, or 1.4%, from $629.8 million at December 31, 2017, and were utilized principally to fund loan portfolio growth. At June 30, 2018, demand deposits were $161.7 million, an increase of $19.0 million, or 13.3% over the comparable period in 2017 and an increase of $14.0 million, or 9.5%, at December 31, 2017. At June 30, 2018, certificates of deposit were $311.1 million, a decrease of $3.8 million, or 1.2%, compared to the prior year period and an increase of $3.3 million, or 1.1%, compared to December 31, 2017. Savings and money market accounts decreased $1.7 million, or 1.0%, when comparing June 30, 2018 to June 30, 2017 and decreased $10.2 million, or 6.0%, compared to December 31, 2017. NOW accounts decreased year-over-year by $3.5 million, or 33.7%, and increased $1.9 million, or 38.0%, compared to December 31, 2017.
Borrowings
Federal Home Loan Bank of New York (''FHLBNY'') Borrowings decreased by $12.5 million, or 8.1%, from the prior year to $142.5 million and by $7.5 million, or 5.0%, compared to December 31, 2017, as a $7.5 million borrowing matured and was paid off during the first quarter of 2018 and two additional borrowings totaling $5.0 million had previously matured and were paid off during the third quarter of 2017. FHLBNY Borrowings at June 30, 2018 mainly consist of borrowings with remaining average terms of one to two years at slightly higher rates than deposits to help provide a cost-effective source of funding and to help the Bank manage interest rate risk. The remaining borrowings of $7.2 million consist of the Company's trust preferred securities originated in 2004.
Stockholders' Equity
Stockholders' equity was $82.7 million, or 9.4% of total assets, at June 30, 2018, a $6.5 million, or 8.5%, increase from June 30, 2017, and an increase of $3.3 million, or 4.2%, from December 31, 2017. Tangible book value per share at June 30, 2018 was $29.79 per share, basic, and $29.49 per share, fully diluted, reflecting increases of $2.73, or 10.1%, and $2.45, or 9.1%, respectively, when compared to June 30, 2017, and increases of $1.44, or 5.1%, and $1.31, or 4.6%, respectively, when compared to December 31, 2017. The increases were due primarily to the retention of net income during the last twelve months and the last six months, respectively.
About First American International Corp.
First American International Corp. is the holding company for First American International Bank, a community development financial institution (''CDFI'') and a minority depository institution (''MDI'') with eight full service branches, including offering consumer and business banking and loan products and services, and non-deposit insured investment products and services, and one satellite mortgage origination office, serving principally the Chinese-American communities in Manhattan, Queens and Brooklyn in New York City.
See accompanying unaudited financial data tables for additional information.
The information contained herein is intended to provide the reader with historical information about the financial results of First American International Corp.
Cautionary Statements Regarding Forward-Looking Information
This press release contains a number of forward-looking statements. These statements may be identified by the use of such words as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would," and similar terms and phrases, including references to assumptions.
Forward-looking statements are based on various assumptions and analyses made by us in light of our management's experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond our control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events that may be subject to circumstances beyond our control; increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment; changes in deposit flows, loan demand or collateral values; changes in accounting principles, policies or guidelines; changes in general economic conditions, either nationally or locally in some or all areas in which we do business, or conditions in the real estate or securities markets or the banking industry; legislative or regulatory changes, including those that may be implemented by the new administration in Washington, D.C.; supervision and examination by our regulators; effects of changes in existing U.S. government or government-sponsored mortgage programs; our ability to successfully implement technological changes; our ability to successfully consummate new business initiatives; litigation or other matters before regulatory agencies, whether currently existing or commencing in the future; or our ability to implement enhanced risk management policies, procedures and controls commensurate with shifts in our business strategies and regulatory expectations.
This press release may also contain forward-looking statements about the pending merger with RBB. These forward-looking statements are subject to numerous assumptions, risks, and uncertainties which change over time. The following factors, among others, could cause actual results to differ materially from forward-looking statements: ability to obtain regulatory approvals and meet other closing conditions to the merger, including approval by FAIC shareholders, on the expected terms and schedule; and delay in closing the merger.
We have no obligation to update any forward-looking statements to reflect events or circumstances after the date of this press release.
For further information, please contact Michael Lowengrub, Chief Financial Officer, at (718) 567-8788 Ext 1388.
First American International Corp.
Financial Highlights (unaudited)
| ($ in thousands) | ||||||||||||||||
| Balance Sheet Items | 6/30/2018 | 3/31/2018 | 12/31/2017 | 6/30/2017 | ||||||||||||
| Cash and cash equivalents | ||||||||||||||||
| Cash and due from banks - noninterest bearing | $ | 5,422 | $ | 5,095 | $ | 5,097 | $ | 5,334 | ||||||||
| Due from banks - interest bearing | 91,869 | 122,057 | 85,152 | 96,758 | ||||||||||||
| Federal funds sold | 917 | 556 | 781 | 641 | ||||||||||||
| Total cash and cash equivalents | 98,207 | 127,708 | 91,030 | 102,733 | ||||||||||||
| Time deposits with banks | 3,801 | 3,800 | 3,800 | 3,800 | ||||||||||||
| Securities | ||||||||||||||||
| Securities available for sale | 15,604 | 16,205 | 16,902 | 24,564 | ||||||||||||
| Securities held to maturity | 26,177 | 26,565 | 26,932 | 28,086 | ||||||||||||
| Total securities | 41,782 | 42,770 | 43,834 | 52,650 | ||||||||||||
| Loans | ||||||||||||||||
| Loans held for sale | 3,400 | 1,707 | 440 | 1,044 | ||||||||||||
| Real estate - residential | 464,576 | 435,495 | 446,472 | 426,849 | ||||||||||||
| Real estate - commercial | 246,971 | 259,239 | 265,325 | 266,478 | ||||||||||||
| Commercial and industrial | 693 | 790 | 4,959 | 2,382 | ||||||||||||
| Consumer and installment | 261 | 297 | 332 | 394 | ||||||||||||
| Unearned loan fees | (2,633 | ) | (2,655 | ) | (2,918 | ) | (3,260 | ) | ||||||||
| Loans receivable, gross | 709,868 | 693,166 | 714,170 | 692,843 | ||||||||||||
| Allowance for loan losses | (9,579 | ) | (9,518 | ) | (9,513 | ) | (9,335 | ) | ||||||||
| Loans, net | 700,289 | 683,648 | 704,657 | 683,508 | ||||||||||||
| Bank premises and equipment | 6,067 | 6,251 | 6,397 | 6,729 | ||||||||||||
| Federal Home Loan Bank stock | 7,313 | 7,276 | 7,613 | 8,011 | ||||||||||||
| Accrued interest receivable | 2,721 | 2,648 | 2,741 | 2,615 | ||||||||||||
| Mortgage servicing rights | 10,868 | 10,504 | 9,131 | 7,365 | ||||||||||||
| Other assets | 5,028 | 3,307 | 3,288 | 5,406 | ||||||||||||
| Total Assets | $ | 879,476 | $ | 889,618 | $ | 872,931 | $ | 873,860 | ||||||||
| Demand deposits | $ | 161,683 | $ | 160,036 | $ | 147,696 | $ | 142,656 | ||||||||
| NOW accounts | 6,830 | 4,669 | 4,951 | 10,303 | ||||||||||||
| Money market and savings | 159,167 | 160,566 | 169,383 | 160,820 | ||||||||||||
| Certificates of deposit | 311,053 | 324,233 | 307,738 | 314,901 | ||||||||||||
| Total deposits | 638,733 | 649,505 | 629,768 | 628,679 | ||||||||||||
| Borrowings | 142,500 | 142,500 | 150,000 | 155,000 | ||||||||||||
| Junior subordinated debentures | 7,217 | 7,217 | 7,217 | 7,217 | ||||||||||||
| Accrued interest payable | 2,255 | 2,118 | 2,462 | 2,001 | ||||||||||||
| Accounts payable and other liabilities | 6,117 | 6,135 | 4,156 | 4,812 | ||||||||||||
| Total Liabilities | 796,822 | 807,474 | 793,603 | 797,710 | ||||||||||||
| Stockholders' equity | 82,654 | 82,144 | 79,328 | 76,150 | ||||||||||||
| Total Liabilities and Stockholders' Equity | $ | 879,476 | $ | 889,618 | $ | 872,931 | $ | 873,860 | ||||||||
First American International Corp.
Financial Highlights (unaudited)
| ($ in thousands except per share data) | ||||||||||||||||
| Summary Income Statement | Year to Date | Quarter Ended | ||||||||||||||
| 6/30/2018 | 6/30/2017 | 6/30/2018 | 6/30/2017 | |||||||||||||
| Interest income | ||||||||||||||||
| Real estate - residential | $ | 10,485 | $ | 9,450 | $ | 5,261 | $ | 4,884 | ||||||||
| Real estate - commercial | 5,988 | 6,099 | 2,872 | 3,014 | ||||||||||||
| Other | 2,075 | 1,541 | 1,022 | 635 | ||||||||||||
| Total interest income | 18,548 | 17,090 | 9,155 | 8,533 | ||||||||||||
| Interest expense | ||||||||||||||||
| Interest-bearing core deposits | 501 | 407 | 251 | 206 | ||||||||||||
| Interest-bearing certificates of deposit | 2,363 | 1,922 | 1,238 | 1,020 | ||||||||||||
| Interest on borrowings | 1,461 | 1,491 | 728 | 753 | ||||||||||||
| Total interest expense | 4,324 | 3,819 | 2,217 | 1,980 | ||||||||||||
| Net interest income | 14,224 | 13,271 | 6,938 | 6,553 | ||||||||||||
| Provision for loan losses | - | 79 | - | - | ||||||||||||
| Net interest income after | ||||||||||||||||
| provision for loan losses | 14,224 | 13,192 | 6,938 | 6,553 | ||||||||||||
| Non-interest income | 6,055 | 5,251 | 2,170 | 3,473 | ||||||||||||
| Non-interest expenses | 15,468 | 13,067 | 8,118 | 7,068 | ||||||||||||
| Income before income taxes | 4,811 | 5,376 | 990 | 2,958 | ||||||||||||
| Provision for income taxes | 1,204 | 1,846 | 385 | 1,019 | ||||||||||||
| Net income | $ | 3,607 | $ | 3,530 | $ | 604 | $ | 1,939 | ||||||||
| Less: Preferred stock dividends and discount accretion | (420 | ) | (408 | ) | (211 | ) | (205 | ) | ||||||||
| Net income available to common shareholders | $ | 3,187 | $ | 3,122 | $ | 393 | $ | 1,734 | ||||||||
| Year to Date | Quarter Ended | |||||||||||||||
| 6/30/2018 | 6/30/2017 | 6/30/2018 | 6/30/2017 | |||||||||||||
| Performance Ratios | ||||||||||||||||
| Return on average assets | 0.72 | % | 0.73 | % | 0.18 | % | 0.80 | % | ||||||||
| Return on average common equity | 9.81 | % | 10.65 | % | 2.38 | % | 11.64 | % | ||||||||
| Average interest earning assets/bearing liabilities | 136.6 | % | 133.6 | % | 137.7 | % | 133.8 | % | ||||||||
| Net interest rate spread | 2.91 | % | 2.88 | % | 2.81 | % | 2.79 | % | ||||||||
| Net interest margin | 3.27 | % | 3.17 | % | 3.19 | % | 3.09 | % | ||||||||
| Yield on loans | 4.75 | % | 4.54 | % | 4.73 | % | 4.52 | % | ||||||||
| Average cost of deposits | 1.18 | % | 0.99 | % | 1.24 | % | 1.03 | % | ||||||||
| Net interest income after provision/total expense | 91.96 | % | 100.95 | % | 85.47 | % | 92.72 | % | ||||||||
| Non-interest income to total revenue | 24.61 | % | 23.50 | % | 19.18 | % | 28.93 | % | ||||||||
| Non-interest expense to total revenue | 62.87 | % | 58.49 | % | 71.68 | % | 58.87 | % | ||||||||
| Non-interest expense to average assets | 3.49 | % | 3.06 | % | 3.66 | % | 3.27 | % | ||||||||
| Net Worth and Asset Quality Ratios | ||||||||||||||||
| Average total equity to average total assets | 9.24 | % | 8.79 | % | 9.35 | % | 8.79 | % | ||||||||
| Total equity to assets end of period | 9.40 | % | 8.71 | % | 9.40 | % | 8.71 | % | ||||||||
| Non-performing assets to total assets | 0.25 | % | 0.41 | % | 0.25 | % | 0.41 | % | ||||||||
| Non-performing loans to total loans | 0.31 | % | 0.51 | % | 0.31 | % | 0.51 | % | ||||||||
| Allowance for loan losses to total loans | 1.34 | % | 1.35 | % | 1.34 | % | 1.35 | % | ||||||||
| Allowance for loan losses to NPLs | 433.89 | % | 261.79 | % | 433.89 | % | 261.79 | % | ||||||||
| Capital, Book Value and Earnings Per Share | ||||||||||||||||
| Total risk based capital ratio (Bank) | 17.52 | % | 16.50 | % | 17.52 | % | 16.50 | % | ||||||||
| Tier 1 risk based capital (Bank) | 16.27 | % | 15.24 | % | 16.27 | % | 15.24 | % | ||||||||
| Leverage ratio (Bank) | 9.94 | % | 9.52 | % | 9.94 | % | 9.52 | % | ||||||||
| Tangible book value per share-basic | $ | 29.79 | $ | 27.06 | $ | 29.79 | $ | 27.06 | ||||||||
| Diluted EPS available to common shareholders | $ | 1.43 | $ | 1.42 | $ | 0.18 | $ | 0.79 | ||||||||
SOURCE: First American International Corp.
