PCB BANCORP
Earnings Results
3Q23
October 25, 2023
Forward-Looking Statement & Non-GAAP
Forward-Looking Statement
This presentation contains forward-looking statements. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections and statements of our beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include without limitation any statement that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as "may," "could," "should," "will," "would," "believe," "anticipate," "estimate," "expect," "aim," "intend," "plan," or words or phases of similar meaning. We caution that the forward-looking statements are based largely on our expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond our control, including but not limited to the health of the national and local economies including the impact to the Company and its customers resulting from changes to, and the level of, inflation and interest rates; the Company's ability to maintain and grow its deposit base; loan demand and continued portfolio performance; the impact of adverse developments at other banks, including bank failures, that impact general sentiment regarding the stability and liquidity of banks that could affect our financial performance and our stock price; changes to valuations of the Company's assets and liabilities including the allowance for credit losses, earning assets, and intangible assets; changes to the availability of liquidity sources including borrowing lines and the ability to pledge or sell certain assets; the Company's ability to attract and retain skilled employees; customers' service expectations; cyber security risks; the Company's ability to successfully deploy new technology; the success of acquisitions and branch expansion; operational risks including the ability to detect and prevent errors and fraud; the effectiveness of the Company's enterprise risk management framework; costs related to litigation; changes in laws, rules, regulations, or interpretations to which the Company is subject; the effects of severe weather events, pandemics, other public health crises, acts of war or terrorism, and other external events on our business. These and other important factors are detailed in various securities law filings made periodically by the Company, copies of which are available without charge on the SEC's website at www.sec.govand the on the investor relations section of the Company's website at www.mypcbbank.com. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements. Any forward- looking statements presented herein are made only as of the date of this presentation, and we do not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, except as required by law.
Non-GAAP Financial Measures
This presentation contains non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of the historical or future financial performance, financial position or cash flows that excludes amounts or is subject to adjustments that have the effect of excluding amounts that are included in the most directly comparable measure calculated and presented in accordance with GAAP. Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are provided in the Non-GAAP Measures section of this presentation.
References to the "Company," "we," or "us" refer to PCB Bancorp and references to the "Bank" refer to the Company's subsidiary, PCB Bank.
2
Corporate Profile
Market Information 10/23/23
Market Cap | $213.6 million |
Stock Price Per Share | $14.97 |
52-Week Range | $13.11 - $20.03 |
Dividend Yield | 4.81% |
Dividend Payout Ratio (4Q22 - 3Q23) | 28.57% |
Outstanding Shares | 14,266,216 |
Stock Information 3Q23 or 9/30/23
Diluted Earnings Per Share ("Diluted EPS") | $0.49 |
Cash Dividend Per Share | $0.18 |
Book Value ("BV") Per Share | $23.87 |
Tangible Common Equity ("TCE") Per Share (1) | $19.05 |
Number of Repurchased Shares (2) | 67,202 |
- Not presented in accordance with GAAP. See "Non-GAAP Measures" for reconciliation of these measures to their most comparable GAAP measures
- Stock repurchase plan announced on 8/2/23
PCB Footprint
3
Historical Performance
Cash Dividend/Diluted EPS & BV/TCE Per Share
$22.94 | $23.87 | ||||||
$4.00 | $25.00 | ||||||
$3.50 | $17.24 | ||||||
$14.44 | $15.19 | $20.00 | |||||
$13.16 | |||||||
$3.00 | |||||||
$18.21 | |||||||
$19.05 | $15.00 | ||||||
$2.50 | |||||||
$2.00 | $10.00 | ||||||
$1.50 | |||||||
$2.62 | $2.31 | $5.00 | |||||
$1.00 | $1.65 | $1.71 | |||||
$1.49 | $0.40 $1.05 | $0.00 | |||||
$0.50 | $0.12 | $0.25 | $0.44 | $0.60 | $0.51 | ||
$0.00 | -$5.00 |
2018 | 2019 | 2020 | 2021 | 2022 | 09/23 YTD | ||||
Cash Dividend Per Share | Diluted EPS | BV Per Share(1) | TCE Per Share (1), (2) |
60.000
50.000
40.000
30.000
20.000
10.000
0.000
Net Income/PTPP Income ($mm)
$52.4 | $53.0 | ||||||||||||||
$36.0 | $38.6 | $36.2 | $40.1 | $35.0 | $33.2 | ||||||||||
$24.3 | $24.1 | $24.8 | |||||||||||||
$16.2 | |||||||||||||||
2018 | 2019 | 2020 | 2021 | 2022 | 09/23 YTD | ||||||||||
Net Income | PTPP Income (2) |
Held-For-Investment Loans ($bn) | |||||
Annualized | |||||
2.500 | CAGR +11.2% | +7.9% | |||
2.000 | |||||
1.500 | |||||
1.000 | $2.05 | $2.17 | |||
$1.73 | |||||
$1.34 | $1.45 | $1.58 | |||
0.500 | |||||
0.000 | |||||
2018 | 2019 | 2020 | 2021 | 2022 | Sep-23 |
Deposits ($bn) | Annualized | ||||
2.500 | +9.5% | ||||
CAGR +9.1% | |||||
2.000 | |||||
1.500 | |||||
1.000 | $1.87 | $2.05 | $2.19 | ||
$1.59 | |||||
$1.44 | $1.48 | ||||
0.500 | |||||
0.000 | |||||
2018 | 2019 | 2020 | 2021 | 2022 | Sep-23 |
- At period end
- Not presented in accordance with GAAP. See "Non-GAAP Measures" for reconciliation of these measures to their most comparable GAAP measures
4
3Q23 Highlights
• Net income of $7.0 million, or $0.49 per diluted share | |
Operating Results | • Provision for credit losses of $751 thousand |
• ROAA of 1.09% & ROATCE (1) of 10.17%, net interest margin of 3.57%, and efficiency ratio of 56.9% | |
• Loans held-for-investment ("HFI loans") increased $45.2 million, or 2.1%, to $2.17 billion | |
• Loans held-for-sale ("HFS loans") decreased $6.4 million, or 48.8%, to $6.7 million | |
Loans | • Average loan yield was 6.43% compared to 6.30% for 2Q23 |
• Total loans to deposits ratio was 99.2% | |
• Quarterly loan production was $157.8 million compared to $123.3 million for 2Q23 | |
Asset Quality | • ACL for loans was $25.6 million, or 1.18% to HFI loans |
• Past due loans were $708 thousand, or 0.03% to HFI loans, and NPLs were $3.7 million, or 0.17% to HFI loans | |
• Total deposits increased $3.9 million, or 0.2%, to $2.19 billion | |
• Core deposits(1) were $1.48 billion, or 67.4% of total deposits | |
Deposits | • Non-interest bearing deposits were $611.0 million, or 27.9% of total deposits |
• Uninsured deposits were $983.9 million, or 44.9% of total deposits | |
• Cost of average interest-bearing deposits and total deposits were 4.17% and 2.97%, respectively | |
• Declared and paid quarterly cash dividend of $0.18 per share | |
Capital & Liquidity | • TBV per share increased to $19.05 |
- Total cash and available borrowing capacity covers 141.0% of uninsured deposits compared to 75.1% at 12/31/22
- Not presented in accordance with GAAP. See "Non-GAAP Measures" for reconciliation to most comparable GAAP measures
5
Selected Financial | ||||||||||||
As of or For the Three Months Ended | Compared to 6/30/23 | Compared to 9/30/22 | ||||||||||
($ in Thousands, Except Per Share Data) | 9/30/23 | 6/30/23 | 9/30/22 | Amount | Percentage | Amount | Percentage | |||||
Income Statement Summary: | $ | |||||||||||
Interest Income | $ | 38,852 | $ | 36,838 | $ | 26,835 | 2,014 | 5.5% | $ | 12,017 | 44.8% | |
Interest Expense | 16,403 | 15,121 | 2,812 | 1,282 | 8.5% | 13,591 | 483.3% | |||||
Net Interest Income | 22,449 | 21,717 | 24,023 | 732 | 3.4% | (1,574) | -6.6% | |||||
Noninterest Income | 2,502 | 2,657 | 3,176 | (155) | -5.8% | (674) | -21.2% | |||||
Noninterest Expense | 14,207 | 13,627 | 13,695 | 580 | 4.3% | 512 | 3.7% | |||||
Provision (Reversal) for Credit Losses (1) | 751 | 197 | 3,753 | 554 | 281.2% | (3,002) | -80.0% | |||||
Pretax Income | 9,993 | 10,550 | 9,751 | (557) | -5.3% | 242 | 2.5% | |||||
Income Tax Expense | 2,970 | 3,073 | 2,798 | (103) | -3.4% | 172 | 6.1% | |||||
Net Income | 7,023 | 7,477 | 6,953 | $ | (454) | -6.1% | 70 | 1.0% | ||||
Diluted Earnings Per Share | $ | 0.49 | $ | 0.52 | $ | 0.46 | (0.03) | -5.8% | $ | 0.03 | 6.5% | |
Selected Balance Sheet Items: | ||||||||||||
HFI loans | $ | 2,167,605 | $ | 2,122,427 | $ | 1,959,237 | $ | 45,178 | 2.1% | $ | 208,368 | 10.6% |
HFS loans | 6,693 | 13,065 | 18,982 | (6,372) | -48.8% | (12,289) | -64.7% | |||||
Total Deposits | 2,192,129 | 2,188,232 | 1,978,098 | 3,897 | 0.2% | 214,031 | 10.8% | |||||
Total Assets | 2,567,974 | 2,556,345 | 2,327,051 | 11,629 | 0.5% | 240,923 | 10.4% | |||||
Shareholders' Equity | 341,852 | 340,411 | 332,719 | 1,441 | 0.4% | 9,133 | 2.7% | |||||
TCE (2) | 272,711 | 271,270 | 263,578 | 1,441 | 0.5% | 9,133 | 3.5% | |||||
Key Metrics: | ||||||||||||
Book Value Per Share | $ | 23.87 | $ | 23.77 | $ | 22.40 | $ | 0.10 | 0.4% | $ | 1.47 | 6.6% |
TCE Per Share (2) | $ | 19.05 | $ | 18.94 | $ | 17.75 | $ | 0.11 | 0.6% | $ | 1.30 | 7.3% |
Return on Average Assets ("ROAA") (3) | 1.09% | 1.19% | 1.19% | -0.10% | -0.10% | |||||||
Return on Average Equity ("ROAE") (3) | 8.12% | 8.82% | 8.16% | -0.70% | -0.04% | |||||||
Return on Average TCE ("ROATCE") (2), (3) | 10.17% | 11.08% | 10.25% | -0.91% | -0.08% | |||||||
Net Interest Margin (3) | 3.57% | 3.55% | 4.25% | 0.02% | -0.68% | |||||||
Efficiency Ratio (4) | 56.94% | 55.91% | 50.35% | 1.03% | 6.59% |
- Provision (reversal) for credit losses and ACL for reporting periods beginning with 1/1/23 are presented under ASC 326, while prior period comparisons continue to be presented under legacy ASC 450 and ASC 310
- Not presented in accordance with GAAP. See "Non-GAAP Measures" for reconciliation of these measures to their most comparable GAAP measures
- Annualized
- Calculated by dividing noninterest expense by the sum of net interest income and noninterest income
6
Loan Overview
HFI Loan Trend ($mm) | |||||||
YoY +10.6% | |||||||
$2,092 | $2,122 | $2,168 | |||||
$2,046 | |||||||
$1,959 | |||||||
$1,833 | $379 | $382 | $384 | ||||
$1,732 | $1,743 | $321 | $357 | ||||
$280 | $280 | ||||||
$231 | $237 | $216 | $249 | $268 | $272 | ||
1,500 | $205 | ||||||
$257 | $217 | ||||||
1,000 | |||||||
$1,289 | $1,348 | $1,422 | $1,440 | $1,445 | $1,469 | $1,504 | |
$1,244 | |||||||
500 | |||||||
- | |||||||
Dec-21Mar-22Jun-22 | Sep-22Dec-22Mar-23Jun-23Sep-23 | ||||||
Commercial Real Estate | Commercial & Industrial | Consumer |
- Per regulatory definition in the Commercial Real Estate ("CRE") Concentration Guidance
HFI Loan Composition
September 30, 2023 | Consumer |
18% |
Commercial Property
Commercial & | 37% | ||||||||||
$2.17B | |||||||||||
Industrial | |||||||||||
13% | |||||||||||
Construction | |||||||||||
1% | |||||||||||
Multifamily | Business Property | ||||||||||
6% | |||||||||||
25% | |||||||||||
Commercial Real Estate(1) Loan Trend ($mm) | |||||||||||
270% | 270% | 249% | 254% | 259% | 255% | 257% | |||||
1,200.0 | 230% | 300% | |||||||||
1,100.0 | |||||||||||
250% | |||||||||||
1,000.0 | |||||||||||
900.0 | 200% | ||||||||||
800.0 | |||||||||||
150% | |||||||||||
700.0 | |||||||||||
600.0 | $733 | $756 | $819 | $898 | $925 | $943 | $941 | $961 | 100% | ||
500.0 | |||||||||||
50% | |||||||||||
400.0 | |||||||||||
300.0 | 0% | ||||||||||
Dec-21 | Mar-22Jun-22Sep-22 | Dec-22Mar-23Jun-23 | Sep-23 | ||||||||
CRE Loans | % to the Bank's Total Risk-Based Capital |
3Q23 Highlights
- HFI loans Increased $45.2 million, or 2.1%, to $2.17 billion
- CRE loans increased $35.2MM (2.4%), C&I loans increased $7.3MM (2.7%) & residential mortgage loans increased $3.7MM (1.0%)
7
Loan Production & Rate/Yield Analysis
New Production(1),(2) by Rate Type ($mm)
8.04% | 8.18% | 7.95% | ||||||||
400 | 7.17% | |||||||||
8% | ||||||||||
5.92% | ||||||||||
350 | 5.23% | |||||||||
6% | ||||||||||
4.01% | 4.26% | |||||||||
$278 | ||||||||||
300 | ||||||||||
$266 | ||||||||||
4% | ||||||||||
250 | ||||||||||
2% | ||||||||||
$186 | $190 | |||||||||
200 | ||||||||||
$129 | 0% | |||||||||
$154 | $169 | $158 | ||||||||
HFI Loans Interest Rate Mix(2)
September 30, 2023
Variable (WA Rate: 8.52%)
39%
HFI Loans
WA Rate
6.19%
Fixed (WA Rate: 4.75%) | Hybrid (WA Rate: 4.71%) |
22% | 39% |
HFI Loans Interest Rate Mix Trend(2)
100% | |||||||||||||||||||
90% | |||||||||||||||||||
80% | 44% | 42% | 39% | 38% | 38% | 38% | 38% | 39% | |||||||||||
70% | |||||||||||||||||||
60% | |||||||||||||||||||
50% | |||||||||||||||||||
40% | 30% | 32% | 37% | 38% | 39% | 39% | 39% | 39% | |||||||||||
30% | |||||||||||||||||||
20% | |||||||||||||||||||
10% | 26% | 26% | 24% | 24% | 23% | 23% | 23% | 22% | |||||||||||
0% | |||||||||||||||||||
Dec-21 | Mar-22Jun-22Sep-22Dec-22Mar-23Jun-2330-Sep | ||||||||||||||||||
Fixed | Hybrid | Variable |
150 | $123 | -2% | ||||||||||||||||||||||||
$97 | $110 | $112 | ||||||||||||||||||||||||
$62 | ||||||||||||||||||||||||||
100 | $114 | |||||||||||||||||||||||||
$126 | $68 | $71 | $83 | -4% | ||||||||||||||||||||||
$69 | $67 | |||||||||||||||||||||||||
50 | $64 | -6% | ||||||||||||||||||||||||
$27 | ||||||||||||||||||||||||||
$27 | $37 | |||||||||||||||||||||||||
$29 | ||||||||||||||||||||||||||
$25 | ||||||||||||||||||||||||||
$23 | ||||||||||||||||||||||||||
$19 | $17 | |||||||||||||||||||||||||
$15 | $14 | |||||||||||||||||||||||||
0 | $4 | -8% | ||||||||||||||||||||||||
4Q21 | 1Q22 | 2Q22 | 3Q22 | 4Q22 | 1Q23 | 2Q23 | 3Q23 | |||||||||||||||||||
Fixed | Hybrid | Variable | WA Rate |
- Total commitment basis
- Excluding SBA PPP loans
- Include both HFI and HFS loans
- Annualized
Repricing Schedule (9/30/23) | HFI Loans | HFS Loans | Total Loans | |||||||||||||||
($ in thousands) | Carrying Value | WA Rate | Carrying Value | WA Rate | Carrying Value | WA Rate | ||||||||||||
Less Than 3 Months | $ | 739,014 | 8.87% | $ | 6,693 | 9.88% | $ | 745,707 | 8.88% | |||||||||
3 to 12 Months | 127,718 | 5.22% | 0 | 127,718 | 5.22% | |||||||||||||
1 to 3 Years | 520,374 | 4.32% | 0 | 520,374 | 4.32% | |||||||||||||
3 to 5 Years | 674,368 | 5.09% | 0 | 674,368 | 5.09% | |||||||||||||
More than 5 Years | 106,131 | 4.89% | 0 | 106,131 | 4.89% | |||||||||||||
Total | $ | 2,167,605 | 6.19% | $ | 6,693 | 9.88% | $ | 2,174,298 | 6.20% | |||||||||
Loan Yield Analysis | 3Q23 | 09/23 YTD | ||||||||||||||||
($ in thousands) | Amount(3) | Yield(4) | Amount(3) | Yield(4) | ||||||||||||||
Average Carrying Value | $ | 2,137,184 | $ | 2,102,600 | ||||||||||||||
Interest on Loans | $ | 33,650 | 6.25% | $ | 95,995 | 6.10% | ||||||||||||
Fee (Cost) | 187 | 0.03% | 488 | 0.03% | ||||||||||||||
Prepayment Penalty & Late Charges | 39 | 0.01% | 160 | 0.01% | ||||||||||||||
Discount (Premium) | 775 | 0.14% | 2,197 | 0.14% | ||||||||||||||
Total Interest & Fees | $ | 34,651 | 6.43% | $ | 98,840 | 6.29% | ||||||||||||
8 |
Loan Concentration | ||||||||||||||
Commercial Real Estate Loans by Property Type (9/30/23) | ||||||||||||||
Carrying | % to | WA | WA | Maturing | ||||||||||
($ in thousands) | Value | Total | Count | LTV(1) | Rate | <= 1 Year | 2-3 Years | 3-5 Years | > 5 Years | |||||
Retail (More than 50%) | $ | 325,238 | 21.6% | 296 | 48.1% | 5.98% | $ | 32,496 | $ | 101,449 | $ | 77,551 | $ | 113,742 |
Industrial | 270,541 | 18.0% | 163 | 49.8% | 5.92% | 63,640 | 45,325 | 80,820 | 80,757 | |||||
Mixed Use | 161,469 | 10.7% | 145 | 45.7% | 5.72% | 27,249 | 39,788 | 62,746 | 31,686 | |||||
Apartments | 112,803 | 7.5% | 53 | 53.0% | 4.88% | 6,467 | 16,783 | 56,989 | 32,564 | |||||
Hotel & Motel | 106,738 | 7.1% | 108 | 49.8% | 7.17% | 10,777 | 5,282 | 37,423 | 53,256 | |||||
Gas Station | 102,736 | 6.8% | 120 | 55.2% | 6.58% | 6,512 | 6,957 | 24,999 | 64,268 | |||||
Office | 90,692 | 6.0% | 52 | 53.8% | 5.73% | 5,241 | 12,922 | 40,653 | 31,876 | |||||
Medical | 56,818 | 3.8% | 29 | 41.3% | 7.56% | 11,991 | 5,894 | 29,118 | 9,815 | |||||
Auto (Sales, Repair & etc.) | 38,610 | 2.6% | 33 | 54.1% | 5.43% | 3,069 | 8,322 | 21,738 | 5,481 | |||||
Car Wash | 36,776 | 2.4% | 31 | 50.6% | 5.93% | 1,472 | 16,897 | 2,989 | 15,418 | |||||
Commercial Condominium | 34,041 | 2.3% | 41 | 47.8% | 5.97% | 5,159 | 6,281 | 7,903 | 14,698 | |||||
Golf Course | 31,072 | 2.1% | 7 | 49.0% | 4.68% | 1,732 | 17,961 | 10,921 | 458 | |||||
Spa, Sauna, & Other Selfcare | 29,669 | 2.0% | 9 | 50.4% | 5.02% | 0 | 13,444 | 9,364 | 6,861 | |||||
Wholesale | 21,655 | 1.4% | 16 | 43.1% | 5.72% | 4,068 | 4,115 | 3,931 | 9,541 | |||||
Construction | 19,246 | 1.3% | 8 | 50.6% | 9.51% | 19,246 | - | - | - | |||||
Church | 10,664 | 0.7% | 15 | 33.1% | 5.11% | 969 | 1,965 | 4,318 | 3,412 | |||||
Others | 54,934 | 3.7% | 75 | 53.5% | 6.30% | 10,106 | 11,767 | 15,840 | 17,221 | |||||
Total | $ | 1,503,702 | 100.0% | 1,201 | 49.5% | 6.01% | $ | 210,194 | $ | 315,152 | $ | 487,303 | $ | 491,054 |
Residential Mortgage Loans (9/30/23)
Carrying | WA | WA | |||||
($ in thousands) | Value | LTV(1) | FICO | ||||
Residential Mortgage | $ | 363,369 | 59.5% | 760 |
- Collateral value at origination
Commercial Real Estate Loans
Geographic Concentration (9/30/23)
Los Angeles County
63%
$1.50B | |||
CA: $1.21B, | |||
(80%) | |||
Other States | |||
3% | |||
Washington | Orange County | ||
3% Texas | 7% | ||
5% | NY/NJ | ||
Nevada | 8% | ||
1% | |||
Other | Ventura | San Bernardino | |
Califronia | County | ||
County | |||
Counties | 4% | ||
4% | |||
2% | |||
9
Loan Concentration
Commercial & Industrial Loans by Industry Type (9/30/23)
($ in thousands) Finance and Insurance
General Manufacturing & Wholesale Trade Real Estate Related
Retail Trade
Food Services
Professional, Scientific, & Technical Services Entertainment & Recreation
Health Care & Social Assistance Other Services Transportation & Warehousing All Other
Total
Carrying | % to | WA | WA Month to | |
Value | Total | Rate | Maturity | |
$ | 89,905 | 32.2% | 7.98% | 5 |
53,059 | 19.0% | 8.78% | 19 | |
33,375 | 11.9% | 7.82% | 18 | |
31,470 | 11.3% | 9.30% | 58 | |
31,246 | 11.2% | 9.20% | 68 | |
14,308 | 5.1% | 9.01% | 14 | |
9,500 | 3.4% | 7.30% | 37 | |
4,246 | 1.5% | 9.16% | 27 | |
3,910 | 1.4% | 8.34% | 43 | |
3,750 | 1.3% | 8.62% | 13 | |
4,839 | 1.7% | 7.79% | 54 | |
$ | 279,608 | 100.0% | 8.46% | 25 |
Commercial & Industrial Loans
Geographic Concentration (9/30/23)
Los Angeles County
61%
$280MM
CA: $221MM
(79%)
Other States | |
7% | Orange County |
Texas | 12% |
NY/NJ | |
2% | |
9% | |
Washington
1%
Nevada | Other | San Bernardino | |
Ventura | |||
2% | Califronia | County | |
County | |||
Counties | 2% | ||
1% | |||
3% | |||
10
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
PCB Bancorp published this content on 25 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 October 2023 00:40:42 UTC.