American Business Bank Announces Third Quarter Net Income Increases 31% Over Prior Year

AMERICAN BUSINESS BANK (OTC Pink: “AMBZ” or the “BANK”) today reported net income of $5.4 million or $0.67 per fully diluted share for the third quarter of 2019 as compared to $4.1 million or $0.53 per fully diluted share for the third quarter of 2018. The increase was primarily due to significant loan and core deposit growth over the last year resulting in increased net interest income.

“We are pleased to announce continued growth in earnings, loans, and deposits. While the increase in loan growth exceeded our expectations, it reflects our long-term commitment to meet the needs of and grow with our many new customers; on a go-forward basis, we expect loan growth to still be robust but in the low double digits annually. The shift to higher earning assets, while maintaining our credit quality, has allowed us to drive continued revenue growth to offset the effects of lower interest rates,” said Leon Blankstein, ABB’s President, CEO and Director.

For the quarter ended September 30, 2019, net income was $5.4 million or $0.67 per fully diluted share, compared with net income of $5.3 million or $0.65 per fully diluted share for the second quarter of 2019. The increase in net income was mainly due to a $1.2 million increase in net interest income, offset by a $532,000 increase in provision for loan losses and a $409,000 increase in non-interest expense. The higher provision for loan losses was the result of a $105 million increase in loans during the third quarter of 2019 while maintaining the allowance for loan losses at 1.4% of loans.

Net interest income increased for the third quarter of 2019 compared to the third quarter of 2018 by $2.8 million or 16% due to an increase in average outstanding loans and a higher yield on loans for the periods compared. The yield on average loans increased to 4.88% for the third quarter of 2019 compared to 4.71% for the third quarter of 2018. The yield on average loans for the third quarter of 2019 was impacted positively by five basis points from non-accrual loan payoffs. The Bank’s cost of deposits remains low at 0.24% for the third quarter of 2019, an increase of seven basis points over the quarter a year ago.

Net interest income increased by $1.2 million for the third quarter of 2019 compared to the second quarter of 2019. For the third quarter of 2019, loan interest income increased $1.0 million or 26% annualized due to an increase in average outstanding loans offset by a decrease in loan yields. The yield on average loans decreased to 4.88% for the third quarter of 2019 compared to 4.91% for the second quarter of 2019. The new loan production weighted average coupon was 4.38% in the quarter compared to 4.98% in the prior quarter.

The Bank’s net interest margin for the third quarter of 2019 was 3.66% which was positively impacted by non-accrual loan payoffs; excluding this non-recurring item, the net interest margin would have been 3.63%. This compares to 3.46% in the third quarter of 2018 and 3.61% for the second quarter of 2019 representing an increase of 20 basis points and an increase of five basis points, respectively. The increase from the third quarter of 2018 was primarily due to average loans being a higher percentage of average earnings assets as well as expansion in average loan yields, offset by a decrease in the average yield on investment securities. The Bank adopted a new accounting standard on January 1, 2019 that required a reduction of the amortization periods for its municipal securities held at a premium to the earliest call date. Thus, the premium amortization was higher which contributed to a lower average yield on the municipal portfolio compared to the third quarter of 2018. The Bank’s net interest margin increased from the second quarter of 2019 primarily due to a higher average loan balance offset by lower loan yields.

On a year-to-date basis, net income was $16.1 million or $1.99 per fully diluted share for the nine months ended September 30, 2019, compared to $10.3 million or $1.31 per fully diluted share for the nine months ended September 30, 2018. The increase was primarily due to significant loan growth between periods, coupled with a higher yield on loans and a low deposit cost resulting in increased net interest income. The shift to higher earning assets can be seen in the increase in the Bank’s loan to deposit ratio from 59% for the third quarter of 2018 to 68% for the third quarter of 2019. The net interest margin was 3.63% for the first nine months of 2019, a 26 basis point expansion from 3.37% for the same period a year ago.

Non Interest Income

Non-interest income in the third quarter of 2019 was $1.3 million. This compares to $1.1 million in the third quarter of 2018 and $1.3 million for the second quarter of 2019. The increase from the third quarter of 2018 was due to a $148,000 increase in Deposit and International Fees as a result of growth in commercial business customers and a reduction in realized losses on the sale of investment securities. The increases to non-interest income are offset by a decline in the gain on sale of SBA loans while other non-interest income remained flat. The Bank has started to portfolio certain SBA loans to add to its interest earning asset base.

On a year-to-date basis, non-interest income for the nine months ended September 30, 2019 was $4.1 million, an increase of $872,000, or 27%, from $3.3 million for the same period a year ago. The increase is mainly attributable to a $394,000 increase in Deposits and International Fees due to growth in commercial business customers and a $286,000 reduction in realized losses on the sale of investment securities. Additionally, interchange income from credit cards, which is included in other non-interest income, increased by $146,000 from the same period a year ago. These increases were offset by a $417,000 decline in gain on sale of SBA loans as the Bank has started to portfolio certain SBA loans to add to its interest earning asset base in 2019.

Non-Interest Expense

Non-interest expense increased $218,000 or 2% for the quarter ended September 30, 2019 compared to the same quarter a year ago. The increase was predominantly due to a $904,000 increase in professional services expense, offset by a $516,000 decrease in salaries and employee benefits expense. The decrease in salaries expense is attributable to a $405,000 deferred compensation plan (DCP) expense related to the ABB stock fund recorded in the third quarter of 2018, compared to no expense in the most recent quarter. Beginning in June of 2019, the Bank is no longer required to mark-to-market its DCP obligation related to the ABB stock fund under US GAAP. The efficiency ratio declined to 59% for the third quarter of 2019 compared to 67% for the third quarter of 2018.

Compared to the second quarter of 2019, non-interest expense increased $409,000 primarily due to a $750,000 increase in professional services expense, offset by a $130,000 decrease in salaries and employee benefits expense and a $159,000 decrease in occupancy and equipment expense. The decrease in salaries and employee benefits expense was attributable to a decrease in DCP expense by the amount of $147,000 related to the ABB stock fund and other measurement funds. The overall decrease in occupancy and equipment expense was due to a $265,000 decrease in lease expense as the lease term of the former Los Angeles headquarters ended in June 2019, offset by a $98,000 increase in depreciation expense related to fixed assets at the new headquarters. The efficiency ratio declined to 59% for the third quarter of 2019 compared to 60% for the second quarter of 2019.

On a year-to-date basis, non-interest expense for the nine months ended September 30, 2019 increased $2.1 million compared to the same period a year ago, due to a $951,000 increase in professional services expense, a $746,000 increase in salaries and employee benefits expense and a $495,000 increase in occupancy and equipment expense. Salaries and employee benefits expense, excluding a one-time $979,000 early retirement payment made to a former executive officer in the first quarter of 2018, increased $1.5 million and was attributable to a larger workforce. The increase in occupancy and equipment expense was mainly due to lease expense recorded for the new Los Angeles headquarters for the first six months of 2019 as required under US GAAP. The Bank relocated its Los Angeles headquarters in June 2019. The efficiency ratio was 61% and 69% for the nine months ended September 30, 2019 and 2018, respectively.

Full time equivalent employees at September 30, 2019 were 195, an increase of seven employees or 4% higher than a year ago, and four more than at June 30, 2019. The Bank now has 29 relationship managers in seven offices.

Wes Schaefer, Executive Vice President and Chief Investment Officer, announced his retirement effective October 31, 2019. Wes was one of the original organizers and founders of American Business Bank. “Wes’ good nature, infectious attitude, and relentless sense of humor will be missed at the Bank,” stated Founder, Director, Chairman Emeritus, Robert Schack. “After so many years of dedicated service, he deserves more time to enjoy life.”

Balance Sheet

Total assets increased $174 million, or 8% from year-end December 31, 2018 to $2.33 billion. Total loans increased $179 million to $1.4 billion, or 14% from year-end primarily in owner occupied real estate. This resulted in an increase in the loan to deposit ratio to 68% from 63% during the year. In the third quarter of 2019, the Bank grew loans by $105 million and deposits by $99 million. At September 30, 2019, non-interest bearing deposits represented 52% of total deposits.

From a year ago, total assets increased $235 million or 11%, from September 30, 2018. This was driven by an increase in deposits of $184 million, or 10% over the twelve months. Total loans increased $291 million, or 26% from a year ago. This resulted in an increase in the loan to deposit ratio to 68% from 59% a year ago.

Asset quality at September 30, 2019 remains excellent with non-performing assets to total assets of 0.07%, $1.5 million in non-performing loans, and no Other Real Estate Owned (OREO). The one non-accrual loan is fully secured by real estate with no specific allowance. At the end of the quarter, the allowance for loan losses stood at $20.0 million, or 1.4% of total loans. For the first nine months of 2019, the Bank had no charge offs.

ABOUT AMERICAN BUSINESS BANK

American Business Bank, headquartered in downtown Los Angeles, offers a wide range of financial services to the business marketplace. Clients include wholesalers, manufacturers, service businesses, professionals and non-profits. American Business Bank has six Loan Production Offices in strategic locations including: North Orange County in Anaheim, Orange County in Irvine, South Bay in Torrance, San Fernando Valley in Woodland Hills, Riverside County in Corona and Inland Empire in Ontario.

FORWARD LOOKING STATEMENTS

This communication contains certain forward-looking information about American Business Bank that is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Such statements include future financial and operating results, expectations, intentions and other statements that are not historical facts. Such statements are based on information available at the time of this communication and are based on current beliefs and expectations of the Bank’s management and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors, including various risk factors. We are under no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

American Business Bank Figures in $000, except share and per share amounts BALANCE SHEETS (unaudited)
					September					June					December					September
					2019					2019					2018					2018
Assets:
	Cash and Due from Banks				$		88,211			$		66,605			$		26,673			$		59,007
	Interest Earning Deposits in Other Financial Institutions						26,077					10,313					76,599					62,497
	Investment Securities:
	US Agencies						305,572					376,573					440,212					464,604
	Mortgage Backed Securities						226,338					194,735					128,851					129,813
	State and Municipals						74,824					72,117					77,460					79,396
	US Treasuries						9,992					9,991					9,859					9,758
	Corporate Bonds						19,861					7,919					1,971					1,976
	Securities Available-for-Sale, at Fair Value						636,587					661,335					658,353					685,547
	Securities Held-to-Maturity, at Amortized Cost						86,915					87,121					87,526					87,546
	Federal Home Loan Bank Stock, at Cost						10,356					10,356					10,356					10,356
	Total Investment Securities						733,858					758,812					756,235					783,449
	Loans Receivable:
	Commercial Real Estate						954,424					893,866					827,388					765,374
	Commercial and Industrial						402,167					365,834					356,583					304,682
	Residential Real Estate						68,259					61,116					62,835					64,853
	Installment and Other						4,765					4,026					3,455					3,528
	Total Loans Receivable						1,429,615					1,324,842					1,250,261					1,138,437
	Allowance for Loan Losses						(20,014	)				(18,548	)				(17,503	)				(15,950	)
	Loans Receivable, Net						1,409,601					1,306,294					1,232,758					1,122,487
	Furniture, Equipment and Leasehold Improvements, Net						8,700					6,453					1,834					1,831
	Other Assets						65,197					73,005					63,344					67,027
	Total Assets				$		2,331,644			$		2,221,482			$		2,157,443			$		2,096,298
Liabilities:
	Non-Interest Bearing Demand Deposits				$		1,084,152			$		988,259			$		983,284			$		972,560
	Interest Bearing Transaction Accounts						221,196					202,465					211,794					197,460
	Money Market and Savings Deposits						751,415					749,979					728,237					672,047
	Certificates of Deposit						42,555					59,524					50,443					73,239
	Total Deposits						2,099,318					2,000,227					1,973,758					1,915,306
	Federal Home Loan Bank Advances / Other Borrowings						-					-					-					1,000
	Other Liabilities						31,258					29,191					18,618					25,048
	Total Liabilities				$		2,130,576			$		2,029,418			$		1,992,376			$		1,941,354
Shareholders' Equity:
	Common Stock				$		163,464			$		162,589			$		154,710			$		154,256
	Retained Earnings						40,795					35,377					27,454					21,360
	Accumulated Other Comprehensive Income / (Loss)						(3,191	)				(5,902	)				(17,097	)				(20,672	)
	Total Shareholders' Equity				$		201,068			$		192,064			$		165,067			$		154,944
	Total Liabilities and Shareholders' Equity				$		2,331,644			$		2,221,482			$		2,157,443			$		2,096,298
	Standby Letters of Credit				$		39,722			$		40,346			$		36,411			$		31,561
Per Share Information:
	Common Shares Outstanding						7,834,279					7,794,212					7,705,590					7,691,918
	Book Value Per Share				$		25.67			$		24.64			$		21.42			$		20.14
	Tangible Book Value Per Share				$		25.67			$		24.64			$		21.42			$		20.14

American Business Bank Figures in $000, except share and per share amounts INCOME STATEMENTS (unaudited)
							For the three months ended:
							September				June				September
							2019				2019					2018
Interest Income:
	Interest and Fees on Loans						$	16,890			$	15,845			$	13,156
	Interest on Investment Securities							4,260				4,145				4,625
	Interest on Interest Earning Deposits
	in Other Financial Institutions							332				263				414
	Total Interest Income							21,482				20,253				18,195
Interest Expense:
	Interest on Interest Bearing Transaction Accounts							152				107				113
	Interest on Money Market and Savings Deposits							1,041				956				587
	Interest on Certificates of Deposits							73				116				96
	Interest on Federal Home Loan Bank Advances
	and Other Borrowings							1				14				12
	Total Interest Expense							1,267				1,193				808
Net Interest Income								20,215				19,060				17,387
	Provision for Loan Losses							1,460				928				505
Net Interest Income after Provision for Loan Losses								18,755				18,132				16,882
Non-Interest Income:
	Deposit Fees							553				543				496
	International Fees							328				254				237
	Gain (Loss) on Sale of Investment Securities, Net							(122	)			(145	)			(208	)
	Gain on Sale of SBA Loans, Net							87				161				149
	Other							487				529				394
	Total Non-Interest Income							1,333				1,342				1,068
Non-Interest Expense:
	Salaries and Employee Benefits							8,444				8,574				8,960
	Occupancy and Equipment							888				1,047				874
	Professional Services							1,946				1,196				1,042
	Promotion Expenses							361				322				341
	Other							1,069				1,160				1,273
	Total Non-Interest Expense							12,708				12,299				12,490
Earnings before income taxes								7,380				7,175				5,460
	Income Tax Expense							1,963				1,906				1,318
NET INCOME							$	5,417			$	5,269			$	4,142
Add back:
	After-Tax Gain (Loss) on Sale of Investment Securities, Net						$	90			$	107			$	158
	After-Tax DCP ABB Stock Expense (Benefit)						$	-			$	52			$	356
Core Net Income							$	5,507			$	5,428			$	4,656
Per Share Information:
	Earnings Per Share - Basic						$	0.68			$	0.66			$	0.54
	Earnings Per Share - Diluted						$	0.67			$	0.65			$	0.53
	Core Earnings Per Share - Diluted						$	0.68			$	0.67			$	0.59
	Weighted Average Shares - Basic							7,999,146				7,947,731				7,683,427
	Weighted Average Shares - Diluted							8,100,992				8,079,466				7,885,205

American Business Bank Figures in $000, except share and per share amounts INCOME STATEMENTS (unaudited)
							For the nine months ended:
							September				September
								2019				2018
Interest Income:
	Interest and Fees on Loans						$	47,813			$	35,614
	Interest on Investment Securities							12,678				14,260
	Interest on Interest Earning Deposits
	in Other Financial Institutions							1,098				552
	Total Interest Income							61,589				50,426
Interest Expense:
	Interest on Interest Bearing Transaction Accounts							363				264
	Interest on Money Market and Savings Deposits							2,804				1,375
	Interest on Certificates of Deposits							293				235
	Interest on Federal Home Loan Bank Advances
	and Other Borrowings							15				328
	Total Interest Expense							3,475				2,202
Net Interest Income								58,114				48,224
	Provision for Loan Losses							2,478				2,268
Net Interest Income after Provision for Loan Losses								55,636				45,956
Non-Interest Income:
	Deposit Fees							1,598				1,394
	International Fees							841				651
	Gain (Loss) on Sale of Investment Securities, Net							(267	)			(553	)
	Gain on Sale of SBA Loans, Net							327				744
	Other							1,648				1,039
	Total Non-Interest Income							4,147				3,275
Non-Interest Expense:
	Salaries and Employee Benefits							26,461				25,715
	Occupancy and Equipment							2,956				2,461
	Professional Services							4,340				3,389
	Promotion Expenses							946				934
	Other							3,323				3,451
	Total Non-Interest Expense							38,026				35,950
Earnings before income taxes								21,757				13,281
	Income Tax Expense							5,668				2,983
NET INCOME							$	16,089			$	10,298
Add back:
	After-Tax Net Gains (Losses) on Sale of Investment Securities						$	198			$	429
	After-Tax DCP ABB Stock Expense (Benefit)						$	449			$	364
Core Net Income							$	16,736			$	11,091
Per Share Information:
	Earnings Per Share - Basic						$	2.02			$	1.35
	Earnings Per Share - Diluted						$	1.99			$	1.31
	Core Earnings Per Share - Diluted						$	2.07			$	1.41
	Weighted Average Shares - Basic							7,948,632				7,623,157
	Weighted Average Shares - Diluted							8,078,529				7,854,031

American Business Bank Figures in $000 QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
						For the three months ended:
						September 2019											June 2019
						Average			Interest			Average					Average			Interest			Average
						Balance			Inc/Exp			Yield/Rate					Balance			Inc/Exp			Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits in Other Financial Institutions					$	58,676		$	332		2.30	%				$	43,368		$	263		2.46	%
	Investment Securities:
	US Agencies						351,204			1,406		1.60	%					402,437			1,449		1.44	%
	Mortgage Backed Securities						208,820			1,422		2.72	%					191,710			1,362		2.84	%
	State and Municipals						163,734			1,094		2.67	%					163,565			1,096		2.68	%
	US Treasuries						10,039			37		1.46	%					10,046			37		1.49	%
	Corporate Bonds						15,328			118		3.07	%					2,720			24		3.46	%
	Securities Available-for-Sale and Held-to-Maturity						749,125			4,077		2.18	%					770,478			3,968		2.06	%
	Federal Home Loan Bank Stock						10,356			183		7.05	%					10,356			177		6.84	%
	Total Investment Securities						759,481			4,260		2.24	%					780,834			4,145		2.12	%
	Loans Receivable:
	Commercial Real Estate						917,398			10,957		4.74	%					870,023			10,289		4.74	%
	Commercial and Industrial						385,315			4,996		5.14	%					359,009			4,712		5.26	%
	Residential Real Estate						66,512			891		5.32	%					60,345			808		5.37	%
	Installment and Other						5,159			46		3.58	%					4,996			36		2.88	%
	Total Loans Receivable						1,374,384			16,890		4.88	%					1,294,373			15,845		4.91	%
	Total Interest Earning Assets					$	2,192,541		$	21,482		3.83	%				$	2,118,575		$	20,253		3.78	%
Liabilities:
	Non-Interest Bearing Demand Deposits						1,059,710			-		0.00	%					1,006,872			-		0.00	%
	Interest Bearing Transaction Accounts						208,403			152		0.29	%					198,638			107		0.22	%
	Money Market and Savings Deposits						746,947			1,041		0.55	%					723,827			956		0.53	%
	Certificates of Deposit						50,425			73		0.57	%					69,674			116		0.67	%
	Total Deposits						2,065,485			1,266		0.24	%					1,999,011			1,179		0.24	%
	Federal Home Loan Bank Advances / Other Borrowings						163			1		2.27	%					2,049			14		2.66	%
	Total Interest Bearing Deposits and Borrowings						1,005,938			1,267		0.50	%					994,188			1,193		0.48	%
	Total Deposits and Borrowings					$	2,065,647		$	1,267		0.24	%				$	2,001,060		$	1,193		0.24	%
	Net Interest Income								$	20,215										$	19,060
	Net Interest Rate Spread											3.59	%										3.54	%
	Net Interest Margin											3.66	%										3.61	%

American Business Bank Figures in $000 QUARTERLY AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
						For the three months ended:
						September 2019											September 2018
						Average			Interest			Average					Average			Interest			Average
						Balance			Inc/Exp			Yield/Rate					Balance			Inc/Exp			Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits in Other Financial Institutions					$	58,676		$	332		2.30	%				$	80,898		$	414		2.08	%
	Investment Securities:
	US Agencies						351,204			1,406		1.60	%					493,172			2,094		1.70	%
	Mortgage Backed Securities						208,820			1,422		2.72	%					112,564			804		2.86	%
	State and Municipals						163,734			1,094		2.67	%					175,161			1,495		3.41	%
	US Treasuries						10,039			37		1.46	%					10,066			37		1.46	%
	Corporate Bonds						15,328			118		3.07	%					2,000			16		3.30	%
	Securities Available-for-Sale and Held-to-Maturity						749,125			4,077		2.18	%					792,963			4,446		2.24	%
	Federal Home Loan Bank Stock						10,356			183		7.05	%					10,356			179		6.92	%
	Total Investment Securities						759,481			4,260		2.24	%					803,319			4,625		2.30	%
	Loans Receivable:
	Commercial Real Estate						917,398			10,957		4.74	%					748,331			8,693		4.61	%
	Commercial and Industrial						385,315			4,996		5.14	%					295,338			3,600		4.84	%
	Residential Real Estate						66,512			891		5.32	%					61,767			784		5.04	%
	Installment and Other						5,159			46		3.58	%					3,755			79		8.32	%
	Total Loans Receivable						1,374,384			16,890		4.88	%					1,109,191			13,156		4.71	%
	Total Interest Earning Assets					$	2,192,541		$	21,482		3.83	%				$	1,993,408		$	18,195		3.57	%
Liabilities:
	Non-Interest Bearing Demand Deposits						1,059,710			-		0.00	%					956,243			-		0.00	%
	Interest Bearing Transaction Accounts						208,403			152		0.29	%					201,146			113		0.22	%
	Money Market and Savings Deposits						746,947			1,041		0.55	%					663,767			587		0.35	%
	Certificates of Deposit						50,425			73		0.57	%					68,957			96		0.55	%
	Total Deposits						2,065,485			1,266		0.24	%					1,890,113			796		0.17	%
	Federal Home Loan Bank Advances / Other Borrowings						163			1		2.27	%					2,946			12		1.66	%
	Total Interest Bearing Deposits and Borrowings						1,005,938			1,267		0.50	%					936,816			808		0.34	%
	Total Deposits and Borrowings					$	2,065,647		$	1,267		0.24	%				$	1,893,059		$	808		0.17	%
	Net Interest Income								$	20,215										$	17,387
	Net Interest Rate Spread											3.59	%										3.40	%
	Net Interest Margin											3.66	%										3.46	%

American Business Bank Figures in $000 YEAR-TO-DATE AVERAGE BALANCE SHEETS AND YIELD ANALYSIS (unaudited)
						For the nine months ended:
						September 2019											September 2018
						Average			Interest			Average					Average			Interest			Average
						Balance			Inc/Exp			Yield/Rate					Balance			Inc/Exp			Yield/Rate
Interest Earning Assets:
	Interest Earning Deposits with Other Financial Institutions					$	61,271		$	1,098		2.42	%				$	38,334		$	552		1.95	%
	Investment Securities:
	US Agencies						395,511			4,612		1.55	%					533,686			6,854		1.71	%
	Mortgage Backed Securities						183,086			3,903		2.84	%					98,888			2,018		2.72	%
	State and Municipals						166,538			3,350		2.68	%					181,359			4,696		3.45	%
	US Treasuries						10,046			111		1.47	%					10,073			111		1.47	%
	Corporate Bonds						6,732			159		3.15	%					2,116			48		3.04	%
	Securities Available-for-Sale and Held-to-Maturity						761,913			12,135		2.12	%					826,122			13,727		2.22	%
	Federal Home Loan Bank Stock						10,356			543		6.97	%					10,189			533		6.97	%
	Total Investment Securities						772,269			12,678		2.19	%					836,311			14,260		2.27	%
	Loans Receivable:
	Commercial Real Estate						873,209			30,901		4.73	%					702,470			23,687		4.51	%
	Commercial and Industrial						366,111			14,308		5.23	%					270,097			9,348		4.63	%
	Residential Real Estate						62,286			2,487		5.34	%					64,153			2,352		4.90	%
	Installment and Other						4,949			117		3.17	%					3,622			227		8.35	%
	Total Loans Receivable						1,306,555			47,813		4.89	%					1,040,342			35,614		4.58	%
	Total Interest Earning Assets					$	2,140,095		$	61,589		3.80	%				$	1,914,987		$	50,426		3.47	%
Liabilities:
	Non-Interest Bearing Demand Deposits						1,021,107			-		0.00	%					911,304			-		0.00	%
	Interest Bearing Transaction Accounts						201,985			363		0.24	%					184,946			264		0.19	%
	Money Market and Savings Deposits						735,682			2,804		0.51	%					629,121			1,375		0.29	%
	Certificates of Deposit						61,515			293		0.64	%					62,686			235		0.50	%
	Total Deposits						2,020,289			3,460		0.23	%					1,788,057			1,874		0.14	%
	Federal Home Loan Bank Advances / Other Borrowings						738			15		2.63	%					26,654			328		1.64	%
	Total Interest Bearing Deposits and Borrowings						999,920			3,475		0.46	%					903,407			2,202		0.33	%
	Total Deposits and Borrowings					$	2,021,027		$	3,475		0.23	%				$	1,814,710		$	2,202		0.16	%
	Net Interest Income								$	58,114										$	48,224
	Net Interest Rate Spread											3.57	%										3.31	%
	Net Interest Margin											3.63	%										3.37	%

American Business Bank Figures in $000 SUPPLEMENTAL DATA (unaudited)
						September					June					December					September
						2019					2019					2018					2018
Performance Ratios:
Quarterly:
Return on Average Assets (ROAA)								0.95	%				0.95	%				1.12	%				0.80	%
Core Return on Average Assets (ROAA)								0.96	%				0.98	%				0.91	%				0.89	%
Return on Average Equity (ROAE)								11.03	%				11.74	%				15.52	%				10.74	%
Core Return on Average Equity (ROAE)								11.22	%				12.09	%				12.61	%				11.95	%
Efficiency Ratio								58.64	%				59.86	%				48.92	%				66.92	%
Core Efficiency Ratio								58.64	%				59.51	%				57.34	%				64.75	%
Year-to-Date
Return on Average Assets (ROAA)								0.96	%				0.97	%				0.80	%				0.69	%
Core Return on Average Assets (ROAA)								1.00	%				1.02	%				0.78	%				0.74	%
Return on Average Equity (ROAE)								11.83	%				12.29	%				10.65	%				8.98	%
Core Return on Average Equity (ROAE)								12.30	%				12.93	%				10.38	%				9.68	%
Efficiency Ratio								60.82	%				61.97	%				63.57	%				69.06	%
Core Efficiency Ratio								59.84	%				60.48	%				65.21	%				68.16	%
Capital Adequacy:
Total Risk Based Capital Ratio								13.81	%				14.37	%				14.09	%				14.70	%
Common Equity Tier 1 Capital Ratio								12.56	%				13.12	%				12.84	%				13.45	%
Tier 1 Risk Based Capital Ratio								12.56	%				13.12	%				12.84	%				13.45	%
Tier 1 Leverage Ratio								8.91	%				8.94	%				8.33	%				8.48	%
Tangible Common Equity / Tangible Assets								8.62	%				8.65	%				7.65	%				7.39	%
Asset Quality Overview
Non-Performing Loans						$		1,481			$		1,047			$		1,222			$		1,361
Loans 90+Days Past Due and Still Accruing								-					-					-					-
Total Non-Performing Loans								1,481					1,047					1,222					1,361
Restructured Loans								229					231					235					237
Other Real Estate Owned								-					-					-					-
ALLL / Loans Receivable								1.40	%				1.40	%				1.40	%				1.40	%
Non-Performing Loans / Total Loans Receivable *								0.12	%				0.10	%				0.12	%				0.14	%
Non-Performing Assets / Total Assets *								0.07	%				0.06	%				0.07	%				0.08	%
Net Charge-Offs (Recoveries) quarterly						$		(6	)		$		(12	)		$		(10	)		$		(13	)
Net Charge-Offs (Recoveries) year-to-date						$		(33	)		$		(27	)		$		(53	)		$		(43	)
Net Charge-Offs (Recoveries) year-to-date / Average Loans Receivable								(0.00	%)				(0.00	%)				(0.00	%)				(0.00	%)
*Includes non-accrual loans, accruing loans past due 90+ days and Troubled Debt Restructurings (TDRs).

 

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