Friendly Hills Bancorp Reports Financial Results for the Second Quarter of 2022

Jul 29th, 2022 13:00 EST

WHITTIER, Calif., July 29, 2022 (GLOBE NEWSWIRE) -- Friendly Hills Bancorp (the “Company”) (OTC Pink: FHLB), the holding company for Friendly Hills Bank (the “Bank”), today reported consolidated results for the second quarter of 2022. The comparability of financial information for the second quarter of 2022 to the same period of 2021 is affected by the acquisition of three branch offices with $82 million in deposits effective September 24, 2021, after which the related operating results are also reflected in these consolidated financials.

Second Quarter 2022 Highlights:

  • Total assets ended the quarter at $306 million, up from $293 million at year end 2021 and $282 million at March 31, 2022.  
  • Total loans have increased $50 million, or 56% to $138 million since year end 2021, and are up $39 million since March 31, 2022.
  • Total deposits ended the quarter at $258 million, stable from the prior quarter and prior year end totals, with noninterest-bearing deposits continuing to reflect strong, relationship-based deposit funding sources at 51% of total deposits.
  • Total risk-based capital ratio was 10.94% and considered “well-capitalized” - the highest regulatory capital category.

For the second quarter ended June 30, 2022, the Company reported a net loss of $477 thousand compared to a net loss of $130 thousand for the three months ended March 31, 2022. During the second quarter, net interest income increased $330 thousand, or 21%, compared to the first quarter of 2022, due to strong organic loan growth; however, comparisons to Q1 also reflect the execution of our long-term plan to invest in our infrastructure, including hiring key talent, which is reflected in noninterest expenses increasing by $339 thousand, and a nonrecurring gain of $470 thousand in Q1 from the prepayment of other borrowings. “Our second quarter results were highlighted by significant loan growth, continued strong credit quality, and expansion into the San Diego market. Our recently onboarded specialty lending group is fully operational, and we are excited to see a robust loan pipeline which bodes well for the second half of 2022,” said Nathan Rogge, President and Chief Executive Officer of Friendly Hills Bank.

“During the first six months of 2022, the Company delivered solid loan growth. Our lending portfolio increased from $89 million as of December 31, 2021, to $138 million as of June 30, 2022,” Rogge continued. The loan portfolio remains diversified with $53 million in Commercial Loans (including $35 million in Owner Occupied Commercial Real Estate Loans), $40 million in Other Commercial Real Estate Loans, and $35 million in Residential Real Estate Loans. The significant increase in loan production during the quarter resulted in net interest margin rising from 2.35% in Q1 to 2.84% in Q2, with net interest margin climbing to 3.16% during the month of June.

“As we enter the second half of the year, we are in a strong position to deliver long-term value for our shareholders while also being mindful of the current economic environment,” Rogge concluded.

ABOUT FRIENDLY HILLS BANK

Friendly Hills Bank, a wholly owned subsidiary of Friendly Hills Bancorp (OTC Pink: FHLB), is a growing community bank catering to individuals, professionals, and small-to-medium sized businesses throughout Southern California. With a history that spans 16 years, the bank offers a personalized approach, access to decision makers, a broad range of solutions, and a commitment to delivering an exceptional customer experience. Friendly Hills Bank operates locations in Los Angeles County, Orange County, San Diego County, and the Inland Empire. For more information, visit friendlyhillsbank.com or call 562.947.1920.

FORWARD-LOOKING STATEMENTS

This news release may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, and Friendly Hills Bancorp intends for such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may” and similar expressions. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. The Company does not undertake, and specifically disclaims any obligation to update any forward-looking statements to reflect occurrences or unanticipated events, or circumstances after the date of such statements except as required by law.

Contacts

Investor Relations ContactJim Burgess858.461.7302[email protected]

Media Relations ContactAmanda Conover562.501.9062[email protected]

--- Summary Financial Table Follows ---

Friendly Hills Bancorp
Consolidated Balance Sheets (Unaudited)
(in thousands, except per share information)
       
  6/30/2022 12/31/2021 6/30/2021
ASSETS      
Cash and due from banks $6,241  $6,499  $3,926 
Interest bearing deposits with other financial institutions  27,214   58,529   87,585 
Cash and cash equivalents  33,455   65,028   91,511 
       
Debt securities  121,890   126,858   17,743 
       
Loans  138,443   88,923   106,439 
Allowance for loan losses  (1,800)  (1,800)  (1,800)
Loans, net  136,643   87,123   104,639 
       
Restricted stock and equity securities  2,982   2,632   2,632 
Premises, equipment and right of use asset, net  2,394   2,313   765 
Bank owned life insurance  5,005   4,951   4,897 
Goodwill and core deposit intangible  1,753   1,788   384 
Accrued interest receivable and other assets  2,306   2,326   757 
Total Assets  $ 306,428   $ 293,019   $ 223,328  
       
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Liabilities      
Deposits      
Noninterest-bearing deposits $131,104  $134,625  $91,197 
Interest-bearing deposits  127,217   122,935   89,135 
Total deposits  258,321   257,560   180,332 
FHLB advances  25,000   12,000   20,500 
Accrued interest payable and other liabilities  3,669   3,730   1,599 
Total Liabilities   286,990     273,290     202,431  
       
Total Shareholders' Equity   19,438     19,729     20,897  
Total Liabilities and Shareholders' Equity $ 306,428   $ 293,019   $ 223,328  
       
Common Shares Outstanding   2,058,393     2,006,393     2,006,393  
Book Value Per Share $ 9.44   $ 9.83   $ 10.42  
       
Friendly Hills Bancorp
Consolidated Statements of Operations (Unaudited)
(in thousands, except per share information)
       
  For the three For the three For the six
  months ended months ended months ended
  6/30/2022 3/31/2022 6/30/2022
Interest income $1,984  $1,699  $3,683 
Interest expense  71   116   187 
Net Interest Income   1,913     1,583    3,496  
Provision for loan losses  -   -   - 
Net Interest Income After Provision for Loan Losses 1,913   1,583   3,496 
       
Noninterest income  199   680   879 
Noninterest expense  2,804   2,465   5,269 
Income (Loss) before Provision for Income Taxes   (692)   (202)   (894 )
Provision for (benefit from) income taxes  (215)  (72)  (287)
Net Income (Loss) $ (477) $ (130) $ (607 )
       
Earnings (Loss) Per Share Basic $ (0.23) $ (0.06) $ (0.30 )

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