Solera National Bancorp Announces Third Quarter 2021 Financial Results

LAKEWOOD, CO / ACCESSWIRE / October 21, 2021 / Solera National Bancorp, Inc. (OTC PINK:SLRK) ("Company"), the holding company for Solera National Bank ("Bank"), a business-focused bank primarily serving the Denver metropolitan area, today reported financial results for the three and nine months ended September 30, 2021.

Highlights for the quarter and six-months ended September 30, 2021 include:

• Pre-tax, pre-provision income climbed to a new record during the third quarter of 2021 at $4.6 million compared to $4.0 million for the second quarter of 2021.
• YTD net income was up 107% at $8.47 million for the nine-months ended September 30, 2021 compared to $4.09 million for the nine-months ended September 30, 2020.
• Cost of funds decreased to 17 basis points for the third quarter of 2021 and 18 basis points year-to-date 2021; this is a 50%, or 18 basis point, improvement over the 0.36% cost of funds for the nine-months ended September 30, 2020.
• The Company's efficiency ratio increased to 41.16% in the third quarter of 2021 compared to 35.06% for the second quarter of 2021, which reflects additional staff hired to support continued growth.
• Traditional gross loans were at $355 million for the nine-months ended September 30, 2021, a 49% increase compared to the nine-months ended September 30, 2020.
• Noninterest-bearing deposits rose 17%, or $55.5 million, quarter-over-quarter and $179.6 million, or 85%, year-over-year ending September 30, 2021 at $390.1 million.
• Asset quality remained constant with criticized assets at 3.47% of total assets and nonperforming assets at 1.22% of total assets as of September 30, 2021.
• Return on average assets increased by 25 basis points to 2.51% for the third quarter of 2021 compared to 2.26% for the second quarter of 2021.
• Return on average equity increased by 4% to 24.69% quarter-over-quarter.

For the three months ended September 30, 2021, the Company reported net income of $3.4 million, or $0.79 per share, compared to $3.1 million, or $0.71 per share, for the second quarter of 2021 and $2.1 million, or $0.51 per share, for the three months ended September 30, 2020. For the nine months ended September 30, 2021, net income was $8.5 million, or $1.97 per share, compared to $4.1 million, or $0.98 per share, for the nine months ended September 30, 2020. Scott Wilson, CEO, commented: "The results of this quarter demonstrate our trajectory of consistent growth, outperforming our peers, and increasing our stockholders' equity. We couldn't be more excited for the future of the bank."

Total assets were $551.9 million at September 30, 2021, an increase of 36% compared to total assets of $404.7 million at September 30, 2020. Total deposits were $489.1 million at September 30, 2021, an increase of 44% compared to total deposits of $339.7 million at September 30, 2020. Net loans were $415.9 million at September 30, 2021, an increase of 28% from net loans of $324.6 million at September 30, 2020. After adjusting for Paycheck Protection Program Loans, net loans were $349.2 million at September 30, 2021, an increase of 50% from $233.5 million at September 30, 2020. At September 30, 2021, the Bank had $66.7 million in Paycheck Protection Program loans, net, as compared to $91.0 million at September 30, 2020. The loans are considered short-term and are paid off by the Small Business Administration as the borrower(s) qualify for forgiveness. The outstanding balance of Paycheck Protection Program loans is expected to continue declining through the remainder of the year.

About Solera National Bancorp, Inc.
Solera National Bancorp, Inc. was incorporated in 2006 to organize and serve as the holding company for Solera National Bank, which opened for business in September 2007. Solera National Bank is a community bank serving the needs of emerging businesses and real estate investors. At the core of Solera National Bank is welcoming, attentive and respectful customer service, a focus on supporting a diverse economy, and a passion to serve our community through service, education and volunteerism. For more information, please visit https://www.solerabank.com/

This press release contains statements that may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The statements contained in this release, which are not historical facts and that relate to future plans or projected results of Solera National Bancorp, Inc. and its wholly owned subsidiary, Solera National Bank, are forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. We undertake no obligation to update or revise any forward-looking statement. Readers of this release are cautioned not to put undue reliance on forward-looking statements.

**FINANCIAL TABLES FOLLOW**

SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)

($000s)		9/30/2021				6/30/2021				3/31/2021				12/31/2020				9/30/2020
ASSETS
Cash and due from banks		$	2,714			$	2,525			$	2,418			$	4,384			$	2,339
Federal funds sold			15,000				2,700				2,000				6,200				6,000
Interest-bearing deposits with banks			1,267				880				828				807				824
Investment securities, available-for-sale			82,588				73,308				74,074				52,877				42,225
Investment securities, held-to-maturity			10,423				10,421				10,420				10,418				10,416
FHLB and Federal Reserve Bank stocks, at cost			1,626				2,330				2,766				1,322				1,256
Paycheck Protection Program (PPP) loans, gross			68,901				97,172				135,102				73,705				93,372
Net deferred (fees)/expenses, PPP loans			(2,165	)			(3,118	)			(3,781	)			(1,520	)			(2,328	)
Net PPP loans			66,736				94,054				131,321				72,185				91,044
Traditional loans, gross			355,636				328,633				307,304				271,184				238,400
Net deferred (fees)/expenses, traditional loans			(846	)			(688	)			(850	)			(782	)			(764	)
Allowance for loan and lease losses			(5,633	)			(5,500	)			(5,500	)			(4,900	)			(4,124	)
Net traditional loans			349,157				322,445				300,954				265,502				233,512
Premises and equipment, net			12,939				13,019				13,093				13,155				8,287
Accrued interest receivable			2,334				2,080				2,444				1,886				1,855
Bank-owned life insurance			5,015				4,989				4,963				4,937				4,910
Other assets			2,086				3,241				5,839				2,119				2,010
TOTAL ASSETS		$	551,885			$	531,992			$	551,120			$	435,792			$	404,678
LIABILITIES AND STOCKHOLDERS' EQUITY
Noninterest-bearing demand deposits		$	390,138			$	334,620			$	272,288			$	235,172			$	210,496
Interest-bearing demand deposits			12,809				15,979				15,487				12,576				8,961
Savings and money market deposits			66,444				89,223				107,202				83,399				61,143
Time deposits			19,678				27,647				50,207				50,999				59,089
Total deposits			489,069				467,469				445,184				382,146				339,689
Accrued interest payable			36				41				54				50				68
Short-term borrowings			-				4,735				34,133				-				14,000
Long-term FHLB borrowings			4,000				4,000				4,000				4,000				4,000
Accounts payable and other liabilities			2,804				1,589				18,828				1,566				941
TOTAL LIABILITIES			495,909				477,834				502,199				387,762				358,698
Common stock			43				43				43				43				43
Additional paid-in capital			38,748				38,748				38,668				38,518				38,518
Retained earnings			17,185				13,786				10,722				8,718				6,870
Accumulated other comprehensive (loss) gain			-				1,581				(512	)			751				549
TOTAL STOCKHOLDERS' EQUITY			55,976				54,158				48,921				48,030				45,980
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	551,885			$	531,992			$	551,120			$	435,792			$	404,678

SOLERA NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

		Three Months Ended																				Nine Months Ended
($000s, except per share data)		9/30/2021				6/30/2021				3/31/2021				12/31/2020				9/30/2020				9/30/2021				9/30/2020
Interest and dividend income
Interest and fees on traditional loans		$	3,498			$	3,298			$	3,005			$	2,792			$	2,596			$	9,801			$	7,678
Interest and fees on PPP loans			1,152				1,259				986				1,027				616				3,397				1,042
Investment securities			614				647				533				411				388				1,794				1,091
Dividends on bank stocks			17				29				26				15				15				72				47
Other			5				3				3				3				3				11				105
Total interest income			5,286				5,236				4,553				4,248				3,618				15,075				9,963
Interest expense
Deposits			192				200				174				187				221				566				768
FHLB & Fed borrowings			17				33				31				18				19				81				69
Total interest expense			209				233				205				205				240				647				837
Net interest income			5,077				5,003				4,348				4,043				3,378				14,428				9,126
Provision for loan and lease losses			149				5				605				782				355				759				1,365
Net interest income after provision for loan and lease losses			4,928				4,998				3,743				3,261				3,023				13,669				7,761
Noninterest income
Customer service and other fees			250				353				206				135				103				809				287
Other income			118				114				114				115				118				346				333
Gain on sale of loan			-				-				-				84				-				-				-
Gain on sale of securities			1,392				462				48				316				866				1,902				1,160
Total noninterest income			1,760				929				368				650				1,087				3,057				1,780
Noninterest expense
Employee compensation and benefits			1,279				1,085				811				891				878				3,175				2,685
Occupancy			175				165				155				106				109				495				314
Professional fees			92				65				56				34				35				213				129
Other general and administrative			695				603				484				383				407				1,782				1,236
Total noninterest expense			2,241				1,918				1,506				1,414				1,429				5,665				4,364
Net Income Before Taxes		$	4,447			$	4,009			$	2,605			$	2,497			$	2,681			$	11,061			$	5,177
Income Tax Expense			1,048				945				601				649				564				2,594				1,091
Net Income		$	3,399			$	3,064			$	2,004			$	1,848			$	2,117			$	8,467			$	4,086
Income Per Share		$	0.79			$	0.71			$	0.47			$	0.43			$	0.51			$	1.97			$	0.98
Tangible Book Value Per Share		$	13.02			$	12.60			$	11.40			$	11.23			$	10.75			$	13.02			$	10.75
WA Shares outstanding			4,299,953				4,298,634				4,291,286				4,276,953				4,175,504				4,296,378				4,154,326
Pre-Tax Pre-Provision Income		$	4,596			$	4,014			$	3,210			$	3,279			$	3,036			$	11,820			$	6,542
Net Interest Margin			3.92	%			3.88	%			3.79	%			4.04	%			3.55	%			3.87	%			3.62	%
Cost of Funds			0.17	%			0.19	%			0.19	%			0.22	%			0.27	%			0.18	%			0.36	%
Efficiency Ratio			41.16	%			35.06	%			32.26	%			32.94	%			39.71	%			36.35	%			44.78	%
Return on Average Assets			2.51	%			2.26	%			1.62	%			1.76	%			2.12	%			2.18	%			1.58	%
Return on Average Equity			24.69	%			23.78	%			16.54	%			15.73	%			18.95	%			21.81	%			12.70	%
Community Bank Leverage Ratio (CBLR)			10.3	%			9.6	%			10.1	%			11.3	%			11.4	%
Asset Quality:
Non-performing loans to gross loans			1.89	%			2.07	%			0.31	%			0.36	%			0.41	%
Non-performing assets to total assets			1.22	%			1.28	%			0.17	%			0.22	%			0.24	%
Allowance for loan losses to gross traditional loans			1.58	%			1.67	%			1.79	%			1.81	%			1.73	%
Criticized loans/assets:
Special mention		$	7,734			$	7,018			$	6,665			$	7,730			$	13,300
Substandard: Accruing			4,729				4,772				10,666				10,709				6,911
Substandard: Nonaccrual			6,710				6,796				955				970				987
Doubtful			-				-				-				-				-
Total criticized loans		$	19,173			$	18,586			$	18,286			$	19,409			$	21,198
Other real estate owned			-				-				-				-				-
Investment securities			-				-				-				-				576
Total criticized assets		$	19,173			$	18,586			$	18,286			$	19,409			$	21,774
Criticized assets to total assets			3.47	%			3.49	%			3.32	%			4.45	%			5.38	%

For More Information Contact:
Scott Wilson, Chief Executive Officer
319-541-8649
[e-mail]

SOURCE: Solera National Bancorp, Inc.

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