California United Bank posted third-quarter net earnings Monday of $601,000, a reversal of the prior year quarter’s loss of about $400,000.
Encino-based California United is a business bank with two loan centers and six branch offices including one on Magic Mountain Parkway in Valencia.
The bank attributed the gains to a 46.1 percent annual jump in interest income (prior to loan loss provisions), stemming mainly from the acquisition late last year of Ventura County rival California Oaks State Bank “as well as the combined bank’s continued ability to generate loans.”
“While the (California Oaks) acquisition added $86.6 million in loans at Dec, 31, 2010, year to date 2011 we are seeing an uptick in loan demand from credit-worthy borrowers in both commercial/industrial and commercial real estate,” Executive Vice President Anne Williams said.
Growing deposits and falling interest-paid rates lowered the bank’s cost of funds to 0.17 percent for the period ending Sept. 30, versus 0.43 percent a year earlier – a drop of 26 basis points.
Loan charge-offs totaled $65,000 during the quarter, but the bank recovered $750,000 for a net recovery of $685,000. Net recoveries were $463,000 for the nine months ending Sept. 30.
Nonaccrual loans fell to $5.4 million from $9.6 million on Dec. 31, 2010, partly due to the transfer of $3.3 million to other real estate owned. As a percentage of total loans (including loans held for sale), nonaccruals fell to 1.15 percent as of Sept. 30 versus 1.28 percent on June 30.
Officials said the bank meets the requirements for a “well capitalized” bank with Total Risk Based Capital and Tier 1 Risk Based Capital ratios of 13.33 percent and 12.11 percent, respectively.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.
You can be the first one to leave a comment.