Malaga Financial Corporation Reports Record Earnings Fourth Quarter and Year-to-Date 2019

PALOS VERDES ESTATES, Calif., Jan. 17, 2020 (GLOBE NEWSWIRE) -- Malaga Financial Corporation (OTCPink:MLGF), the parent company of Malaga Bank FSB, today reported that net income for the quarter ended December 31, 2019 was $4,287,000 ($0.59 basic and $0.58 fully diluted earnings per share), an increase of $442,000 or 11% from net income of $3,845,000 for the quarter ended December 31, 2018 ($0.53 basic and $0.52 fully diluted earnings per share, as adjusted for the stock dividend declared on November 15, 2019). Net income for the twelve months ended December 31, 2019 was $15,387,000 ($2.11 basic and $2.10 fully diluted earnings per share) compared to $15,305,000 ($2.11 basic and $2.09 fully diluted earnings per share, as adjusted for the stock dividend declared on November 15, 2019) for the twelve months ended December 31, 2018, a 1% increase. For the twelve months ended December 31, 2019, the Company’s annualized return on average equity was 10.94% and the annualized return on average assets was 1.33%, as compared to 11.65% and 1.44%, respectively, for the same period in 2018.

The Company did not have any delinquent loans or real estate owned at December 31, 2019. The Company’s allowance for loan losses was $3,523,000, or 0.31% of total loans, at December 31, 2019.

For 2019, net interest income totaled $33,069,000, an increase of $492,000 or 2% from 2018. This increase reflected higher average interest-earning assets of $94.6 million offset by a decrease of 0.26% in the interest rate spread to 2.81%. The decrease in the interest rate spread is primarily attributable to an increase in the average cost of funds of 0.35% offset by an increase in the yield on average interest-earning assets of 0.09%.

Provision for loan losses increased $304,000 to $353,000 in 2019 from $49,000 in 2018. The increase is primarily due to growth in the loan portfolio.

Operating expenses decreased $179,000 or 2% to $11,775,000 in 2019 from $11,954,000 in 2018. The decrease is primarily attributed to a deposit insurance premiums credit of $230,000.

Randy C. Bowers, Chairman, President and CEO, remarked, “We are pleased to report record earnings for both the 4^th quarter and full year 2019. Loan portfolio growth for 2019 was 15% or $149 million and quarterly earnings increased 11% from the same period in 2018. These strong operating results enabled us to once again reward our shareholders with a special year-end 5% stock dividend in addition to quarterly cash dividends.”